Are We Sure Lucid Motors Can Be the Next Tesla?

 

 

 It has not been an easy run for growth stocks recently. Banning Tesla (NASDAQ TSLA) has also been a tough lift for electric vehicle (EV) makers like Lucid Motors (NASDAQ LCID). From the 52-week high, LCID stock is now down nearly 62 as it languishes near last month’s low of$20.49. The stock didn't respond well to the company’s earnings report that was released on Feb. 28. Non-GAAP earnings were in line, but GAAP earnings were a miss.

 While profit grew further than 600 times over time as the company now has deliveries, it came in significantly below judges’ prospects. 

As you may have guessed, products and deliveries have been the malefactor of the decline in LCID stock price. Unfortunately, the company had to cut its 2022 product figures from its prognosticated vehicles down to a range of vehicles. Lucid’s principal administrative officer stated, “ This reflects the extraordinary force chain and logistics challenges we ’ve encountered and our implacable focus on delivering the loftiest quality products.” 

 

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 To help with its force chain issues, the company lately blazoned plans for a new battery factory. LG Energy Results will be investing$1.4 billion to make a battery manufacturing installation in Queen Creek, Arizona — within an hour's drive from Lucid’s manufacturing factory in Casa Grande, Arizona. Lucid expedient this move will help its long-term growth. By 2030, the company plans to have the Arizona plant produce EVs annually. 

Along with its promising EV technology, investors continue to wonder if Lucid can come to the coming Tesla. It isn't that Lucid can’t be Tesla-suchlike in the future when it comes to products. Still, numerous-Tesla sympathizers fail to separate some of the effects that make Tesla unique. For starters, it has Elon Musk, who seems to carry a decoration with him. Second, the company has an entire energy business to consider, alongside an EV- leading product setup. It has multitudinous locales around the world in North America, China, and Europe. 

 

So, can Lucid implement this from an automotive perspective?

 Of course, it can — ultimately. But product detainments are a part of life for automakers and Lucid Motors is working through those issues now. In fact, significant issues. 

It'll need to stabilize its product plans to start working on “ being the coming Tesla.” Product increases and stabilization would be a great launch for LCID stock’s future to go well. Still, it also needs the bear request in growth and EV stocks to come to an end before it can find sustainable downside instigation. 

 

 On the date of publication, Bret Kenwell didn't have (either directly or laterally) any positions in the securities mentioned in this composition. The opinions expressed in this composition are those of the pen, subject to theInvestorPlace.com Publishing Guidelines. 

Bret Kenwell is the director and author of Unborn Blue Chips and is on Twitter@BretKenwell. 

 

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