Electric vehicle makers Lucid, Nikola and Lordstown saw their shares decline mainly due to disappointing failures regarding their production numbers.
Three new electric vehicle (EV) companies that went public through special purpose acquisition companies (SPACs) recently fell short of their projected 2022 targets. Electric vehicle companies Lucid Group Inc (NASDAQ: LCID) reportedly ), Nikola Corp (NASDAQ: NKLA) and Lordstown Motors (NASDAQ: RIDE) had a disappointing 2022.
Production development of electric vehicles Lucid, Nikola and Lordstown
The trio missed their EV targets by significant margins, with Lucid and Lordstown Motors suffering sizable shortfalls on production targets. For perspective, Lucid accomplished just over a third of its production schedule for the year with 7,180 Air sedans. The California-based EV maker had been aiming to produce 20,000 vehicles by 2022. Meanwhile, Lordstown Motors could only manage production of 31 Endurance trucks in the same period. This number pales in comparison to the 500-vehicle production run the Ohio-based EV automaker had in mind.
Nikola also delivered a disappointing number of 131 Tre heavy trucks. This number was about a quarter of the 500 vehicles the Phoenix-based company had envisioned for its 2022 production line.
After their less-than-stellar 2022 EV production outing, Lucid, Nikola, and Lordstown see the odds improve little in 2023.
Lucid
Lucid shares took a nosedive after the company’s curtailed production forecast of 14,000 vehicles this year. Shares of the electric vehicle maker plunged more than 14% in the early trading session on Thursday after Lucid hinted at a decline in demand. According to Visible Alpha, analysts expected production of just under 22,000 vehicles from Lucid this year.
In addition, the EV maker also acknowledged that it was locked in a price war with EV heavyweights Tesla (NASDAQ: TSLA). Tesla and Ford Motor Company (NYSE: F) have embarked on aggressive price cuts to induce higher demand amid a shaky tech sector. However, these cuts also make it more difficult for less illustrious rivals such as Lucid and Rivian Automotive Inc (NASDAQ: RIVN) to gain market share.
BofA Global Research downgraded Lucid shares to “neutral” from “buy.” The research firm also added that, considering operations and free cash flow, the company may not break even until 2027.
EMG Advisors CEO Will McDonough also commented on Lucid’s plight of earnings, saying:
“Lucid’s earnings unfortunately show that it is a business that is in the public markets sooner than it should be. Now that the markets are less fluid, investors are focusing on the fact that this company only produced 7,000 cars in 2022.”
Nikola and Lordstown
Nikola’s shares also declined after the electric vehicle company announced projected deliveries of no more than 375 trucks. Meanwhile, Lordstown Motors shares also fell after the electric vehicle maker announced a suspension of production and customer deliveries in January. According to Lordstown Motors, it halted production and customer deliveries due to performance and quality issues.
Lordstown tumbled 15%, while Nikola shares fell 9% in yesterday’s trading session in New York. Nikola’s shares initially fell 1.3% after a quarterly earnings loss.
next
Tolu is a Lagos-based blockchain and cryptocurrency enthusiast. He likes to demystify the crypto stories down to the basics so that anyone anywhere can understand them without too much prior knowledge. When he’s not up to his neck in crypto-stories, Tolu likes music, loves to sing, and is an avid movie buff.
