Lucid dismisses report that it is weighing filing for bankruptcy or going private after shares plunge
The report said Lucid was considering options that could include going private or filing for bankruptcy protection.
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A Lucid Air electric vehicle (EV) at the company's showroom in Tysons, Virginia, US, on Saturday, Feb. 17, 2024.
Samuel Corum | Bloomberg | Getty Images
Lucid Motor stock fell more than 40% at one point and trading was halted for volatility multiple times Tuesday amid speculation that the company is considering new options.
A site focused on electric vehicles called EV reported Tuesday Lucid was considering going private or filing for Chapter 11 bankruptcy protection. According to the site, the company asked AlixPartners to review those options and deliver its findings to Lucid's board before its next meeting.
The report from EV also said AlixPartners had encouraged the board to further restructure in the U.S. and Europe and to focus on the Gravity SUV.
AlixPartners said it had no comment on the report. Lucid said in a statement that "the rumors are completely false."
"The company has sufficient liquidity to carry its operations well into next year, as recently published in its last quarterly filings, and it has not formed any special Board committee to explore the scenarios reported today," the company said in a statement." Our focus is on improving execution, strengthening operations, and positioning Lucid to realize the full potential of its technology, products, and innovation. AlixPartners is assisting us in that and nothing else and has not recommended bankruptcy to management or the Board."
Lucid has been facing an increasingly challenging market amid slower-than-expected adoption of EVs and changing regulations under the Trump administration, including the elimination of a $7,500 federal incentive for purchasing an EV.
The EV maker, which is heavily backed by Saudi Arabia's Public Investment Fund, said last month that it was laying off 18% of its U.S. workforce as part of a cost-savings plan.
Earlier this month, Lucid missed Wall Street expectations for second-quarter delivery results.
The company's new CEO Silvio Napoli announced a shake-up of the company's leadership team at the time to "simplify the company's structure."
Lucid in May suspended its production guidance as Napoli said he would be evaluating the company's business decisions, adding that it needs to lower its "elevated inventory" of vehicles.
