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Lucid Motors said Tuesday that its \u201coperational reset\u201d will focus on $1.4 billion in cash reductions along with three other \u201cmust win\u201d and potential money-making priorities that include robotaxis, its factory in Saudi Arabia, and launching a mid-sized electric vehicle.<\/p>\n
The turnaround plan, led by its new CEO Silvio Napoli, aims to pull Lucid out of its spiral of growing EV inventory and unchecked spending. To reach that $1.4 billion in cash savings, Lucid said it will reduce capital expenditures by $500 million and projected savings of between $600 million and $800 million in inventory, according to its second-quarter earnings<\/a> statement. The company said it will also reduce operating expenses by $200 million.<\/p>\n The effort, if successful, will provide sufficient liquidity runway well into 2027, Napoli said during Tuesday\u2019s earnings call with investors. <\/p>\n Napoli didn\u2019t mince words during his first quarterly earnings call as CEO.<\/p>\n \u201cThe way we operate has to change,\u201d he said. \u201cWhile there is no question that Lucid brought leading innovations and outstanding products to the market, we have disappointed on several fronts, and for far too long. We have not executed consistently, we miss commitments, launched products before they were ready, underinvested in service, responded too slowly to quality issues, and allowed complexity to slow decisions down.\u201d<\/p>\n Napoli has already set some of this plan in motion. The company has shaken up its leadership ranks and hired several top execs<\/a>, including a new chief financial officer, chief technology officer, chief customer officer, chief digital officer, and chief transformation officer. Napoli has also cut in half the number of people who directly report to him and in June directed the company to lay off 18% of its workforce, or around 1,500 employees, just four months after the EV maker made a cut of 12%.<\/p>\n Lucid also eliminated the second shift of EV production at its factory in Casa Grande, Arizona. The layoffs and elimination of that second shift generated $158 million in projected annualized savings, Napoli said during the company\u2019s earnings call.<\/p>\n Despite these moves, Lucid\u2019s second-quarter earnings<\/a> show a company that continues to lose money. The EV maker reported revenue of $405 million, up from $259.4 million in the same quarter last year. It reported a net loss of $1.26 billion, or $3.30 a share, compared with a loss of $855.3 million, or $2.80 a share, a year earlier.<\/p>\n Lucid said it ended the second quarter with $3 billion in total liquidity.<\/p>\n While a reduction in spending is central to this reset, Napoli listed several must-win projects, including its upcoming mid-sized EV, finishing its AMP-2 factory in Saudi Arabia, and its robotaxi program with Uber and Nuro, that will eventually make it profitable.<\/p>\n The midsize EV, known as Cosmos, will be the first model from Lucid\u2019s mid-sized platform, which \u201cremains an essential element of Lucid\u2019s strategic plan,\u201d Napoli said. <\/p>\n Napoli is also bullish on its robotaxi program with Uber and Nuro and sees it as an opportunity to boost earnings outside of selling directly to consumers. In a sign of this program\u2019s value to Lucid, the company has created a new business unit called Lucid Technologies that will be led by chief digital officer Kai Stepper. The new unit will focus on AI, an advanced driver assistance system, and digital technology.<\/p>\n \u201cWe project the margins vastly exceeding those of the traditional retail model,\u201d Napoli said, referring to the robotaxi program that integrates Nuro\u2019s self-driving technology into Lucid\u2019s Gravity SUVs. Uber will operate the premium robotaxi service, which will allow users to hail the self-driving vehicles on its app. <\/p>\n Nuro and Uber are testing a fleet of 100 vehicles in Houston and the San Francisco Bay Area. The company said that last month it began delivering production validation vehicles assembled at a facility in Coolidge, Arizona. Regular vehicle production for the robotaxi will begin in the fourth quarter with an expected launch in late 2026.<\/p>\n On the call, Napoli also took a moment to slap down speculation<\/a> from last month that the company had hired consulting firm AlixPartners to consider bankruptcy.<\/p>\n \u201cTheir engagement has been focused solely on supporting our cost-savings plan and streamlining our operations; we will be wrapping up their assignment once that work is complete, which we expect at the end of this month,\u201d he said.<\/p>\n<\/div>\n When you purchase through links in our articles, we may earn a small commission<\/a>. This doesn\u2019t affect our editorial independence.<\/em><\/p>\n