By the end of this week, 1,300 people who work for Lucid Motors will know they are going to lose their jobs. The luxury electric vehicle maker has notified (PDF) the United States Securities and Exchange Commission in a filing it is fire approximately 18% of its workforce. Lucid said he was cutting jobs to reduce operating expenses “in response to changing business needs and productivity improvements” and that he intended to complete this plan. restructuring by the end of the second quarter of this year.
Lucid CEO Peter Rawlinson told employees in a memo that the job cuts will affect both employees and contractors. In the United States, almost all divisions will be affected by cuts, and some executives are even included in the list of personnel the company is laying off. The electric vehicle maker has implemented other cost-cutting measures, such as revising its non-critical spending, after announcing its Results of results 2022 in February. But apparently these measures were not enough for the company to achieve its goals.
While Lucid saw a strong year-over-year increase in revenue – it had only just started the air sedan production at the end of 2021 – it remains below analysts’ forecasts. Moreover, although its production target (14,000 EVs) for 2023 is double last year figures, it is much less than the 21,000 units expected by the experts. As Reuters Previously reported, Tesla price cuts and the availability of affordable EVs from traditional automakers had reduced demand for vehicles from startups like Lucid. Rivian, another EV startup, is also affected and has announced that it will reduce its workforce six percent in February.
Lucid said in his filing that the layoffs will cost the company $24 million to $30 million, which will be spent on severance, company-paid health insurance and stock-based compensation for affected workers. Despite its cost-cutting measures, Lucid still intends to expand globally and continue to develop more models, including the three-row model. Gravity Electric SUV which he plans to release in 2024.