Automaker Lucid reduced production goals again because the logistics are proving a challenge to its output.


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Automaker Lucid reduced production goals again because the logistics are proving a challenge to its Lucid again cuts production targets as logistics challenges cripple output

Lucid Group’s production targets were again cut Wednesday.

Supply chain and logistics obstacles mean demand for the company’s electric vehicles is outstripping supply.

In the second quarter, the company delivered just 679 Air electric luxury sedans out of more than 37,000 orders.

Lucid Group, maker of electric vehicles, cut its production targets again Wednesday due to difficulties in its supply chain and logistics.

Air has over 37,000 reservations for its electric sedan, up from more than 30,000 in May – but just 679 cars were delivered in the second quarter. The company said in February that it would build about 12,000 to 14,000 vehicles in 2022, down from an original forecast of 20,000.

To get their numbers up, they announced they’re expecting to deliver 6,000 to 7,000 vehicles in 2022 and they appointed a new exec to lead operations.

The company’s shares fell 12% in after-hours trading following the news.

Lucid released its second-quarter results along with the announcements. Here are key numbers:

Revenue: $97.3 million
Loss per share: 33 cents
Vehicles delivered: 679

We have revised our production guidance to reflect the unprecedented logistics and supply chain challenges we encountered,’ CEO Peter Rawlinson said in a statement. “ adding key hires to the executive team, and restructuring our logistics and manufacturing organization.”

Lucid released a press release explaining how issues related to semiconductor chips, glass, and carpet caused the price to drop.

Rawlinson admitted to CNBC that, during this difficult process, the company realized they had other problems as well.

“It exposed the immaturity of our logistics systems,” Rawlinson said, adding that Lucid is in the process of bringing shipping in-house.

To address these concerns, Lucid announced Wednesday that it has hired Stellantis veteran Steven David as its senior vice president of operations, in charge of manufacturing, logistics, and quality control.

Sherry House, CFO of the company, told CNBC that its 37,000 reservations do not include those for its upcoming SUV or those ordered by the Saudi government.

In April, Lucid stated that Saudi Arabia’s government had agreed to buy up to 100,000 of its vehicles over the next 10 years. The country’s major investment company is a significant shareholder in Lucid, holding more than 62% of the company’s shares.

As of the end of the second quarter, Lucid had $4.6 billion in cash and equivalents, down from $5.4 billion in March, but enough to fund operations for well over the next two years.


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