Lucid SPAC: Everything you need to know about Lucid
Ben Lobel July 26, 2021 12:10 PM
Can Lucid enjoy the share price fireworks that have lit up EV rival Tesla? Discover more about the company's history, strategy and valuation.
What is Lucid?
Lucid is a US-based automobile company with a focus on electric cars. Based in Newark, California, it first focused on battery packs for Chinese vehicles before developing its first car, the Lucid Air, in 2020.
As of February 2021 the pre-revenue company has raised well in excess of $1 billion in funding, fully developed its first model, finished building its Arizona-based greenfield site factory, and employs some 2,000 personnel.
How does Lucid make money?
When Lucid begins production of its Air model, the company will make money through automobile sales. As of February 2021, the company has received more than 7,500 pre-orders totalling some $650 million in reservations.
Is Lucid profitable?
Lucid is not a profitable company as of February 2021, as while its first model is developed and pre-orders have come in, production is yet to start. The company has projections for profitability by the year 2024, but in the meantime will be outlaying large sums as it begins manufacture and delivery of the Air in North America in the second half of 2021. Lucid’s factory, completed in December 2020, cost $700 million to build.
Who are Lucid’s competitors?
Common sense might suggest that Lucid’s main competitor is electric vehicle peer Tesla, but Lucid CEO Peter Rawlinson has instead suggested that the Lucid Air will primarily be going after the fellow luxury sedan Mercedes S-class, which was revealed within one month of the Air.
Rawlinson believes that the newcomer can compete with the established German model due to his perceived inadequacy of more well-known carmakers’ response to the EV revolution, as well as the inefficiencies of more-established manufacturers. To the latter point, Rawlinson claims that the Lucid Air travels four-and-a-half miles per kilowatt hours or kWh (kWh being the standard measure of efficiency for plug-in vehicles), a mark that significantly outperforms traditional players’ electric offerings.
While Lucid’s attitude towards Tesla seems relaxed, the latter’s founder Elon Musk has appeared more sensitive to a potential rivalry, responding to the news that the Lucid Air’s pricing would start at $77,400 by cutting the price of his own Tesla Model S by $3,000 in October 2020.
What is Lucid’s strategy?
Lucid’s strategy is currently focused on rolling out the Air model, which some view as the equivalent to Tesla’s Model S. The Air, production of which will begin in spring 2021, will boast horsepower of up to 1,080, a 20-minute charge, 0-60mph in 2.5 seconds and a top speed of 168 mph.
The Air Pure, the base model, will see prices start at $69,900, similar to the Tesla Model S, while the Air Touring will be offered at $87,500. Finally, the Air Grand Touring will go on sale for prices starting at $131,500.
While the immediate focus is the Air Pure, the company has longer-term plans to expand into aerospace and agriculture.
Who are the directors of Lucid?
Lucid was founded by former Tesla VP Bernard Tse and former Oracle executive Sam Weng in 2007 under the name Atieva Inc, although Weng is no longer involved with the business in an official capacity. The original iteration of the company was focused on developing EV batteries rather than the vehicles themselves.
Today, there are a number of prominent board members and advisors, including Turqi Alnowaiser, head of the international investment strategy of the Saudi Arabian Public Investment Fund, which holds a majority stake in Lucid.
Here are some of the key personnel at the company.
- CEO and CTO: Peter Rawlinson
- Chairman: Andrew Liveris
- Vice President of Finance: Michael Smuts
- Vice President of Design: Derek Jenkins
- Vice President of People: Michael Carter
When was the Lucid SPAC?
Lucid’s flotation, which took place on July 26, 2021, took the form of a merger with a SPAC entitled Churchill Capital IV Corp (CCIV).
The transaction involved CCIV contributing $2.1 billion in cash, as well as a new round of funding from various other parties including BlackRock and yet more cash from the Saudi Public Investment Fund. The merger gave the combined company a pro-forma equity value of $24 billion.
Want to trade more IPOs? Visit our IPO trading page.
How much is Lucid worth?
The merger with CCIV valued Lucid at $24 billion, but the implied market value of Lucid and CCIV combined is more than double that.
The price was seemingly influenced in part by the market hype surrounding EV companies in the wake of the Tesla bull run but, that said, there is no denying that Lucid is at a relatively advanced point.
The company boasts impressive technology and a highly-qualified management team, as well as been in the position of having developed its first model, not to mention established its factory and product pipeline. The company has also outlined ambitions to expand beyond the EV sector in future.
How to trade Lucid shares
You can trade Lucid through Churchill Capital Corp (CCIX) shares on City Index. Find out more about trading shares on our award-winning platform.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.