Overview of Lucid Motors Q3 Earnings
To set expectations for Q4 earnings we need to understand what happened in Q3. Here’s a short recap of the biggest takeaways from Lucid's Q3 earnings conference call that every Lucid investor, must know.
- Lucid Motors announced in their Q3 earnings that they have started production on their Lucid Air Dream Edition and would begin deliveries in October 2021.
- Peter Rawlinson reiterated that the number of reservations had grown to over 17,000 as of November 15th, 2021.
- Because of the number of reservations, Lucids order book was over $1.3 billion in estimated bookings.
- We also learned that Lucid Group had about $4.3 billion cash on hand.
During Lucid's Q3 earnings call, Rawlinson emphasized that Lucid is currently "laser-focused" on ramping production to 20,000 units in 2022 and 50,000 in 2023. By the end of the decade, though, Lucid sees production capacity at its Casa Grande facility in Arizona expanding to 500,000 units. Thanks to an expansion of 2.7 million square feet, including mechanical and industrial building space.
5 Answers Investors Want to Know
1 Lucid Air Models are Gaining Attention
This is self-explanatory; we want to know that the Lucid Air is getting more reservations, specifically what trim has the bulk of the orders. For perspective, Lucid's lowest-priced Air Pure is priced at $77,400 a car, followed by Air Touring at $95,000 and Air Grand Touring at $139,000 per unit. Dream Edition is the top model. The Dream Edition is fully reserved, so how many reservations do the other models have?
During its Q3 earnings call, Lucid said its order book of 13,000 cars was worth around $1.3 billion in revenue as of the end of September. That translates into a price point of around $100,000 per car, representing roughly the mid-point of prices of all four models. But specifics on allocation would be significant for investors to know.
2. Formula E Revenue
Many people overlook this, but this is one of the biggest differentiators between Lucid and other EV companies. CEO and CTO Peter Rawlinson stressed during the Q3 call how Lucid's battery packs powered every single car in Formula E, enabling the premier electric motorsports cars to complete "full race distances on a single charge." So an insight into total revenue numbers and advancements in Formula E will set this stock apart from other EV stock and give more guidance to the investors.
3. Production Ramp and Lucid Air Dream Edition Deliveries.
Although many speculate that Lucid Motors will not hit its expected delivery goals for this quarter, I don't think that is the most important thing. What's more important is making sure Lucid can speed up production to its full pace without sacrificing quality. Figuring out manufacturing kinks, supply chain issues, and really understanding how to make the production line efficient is more important than a delivery goal IMO. I would rather see production issues fully addressed so they can really churn out cars this year.
4. Project Gravity: Lucids Premier SUV
2023 is supposed to be the year for the Lucid Gravity. So far, we haven't heard anything or seen anything about the Gravity project. While it might be a little early to announce anything about the Lucid Gravity, knowing that progress is being made, will boost investor confidence.
5. ESS Lucids Energy Storage System
Here's what Peter Rawlinson said about their ESS program last year
Right now, it's probably, in terms of effort...one-half of 1% of our endeavor. But I wouldn't be surprised if in five years from now it was bigger than our automotive business. I wouldn't be surprised if ESS [Energy Storage Systems] didn't generate more revenue than our cars.
Lucid Group has a massive opportunity with society going more green and an infinitive from clean, renewable energy. In 2020, more than 260 gigawatts of renewable energy capacity were added globally. According to the International Renewable Energy Agency, the United States was one of the biggest markets adding 29 gigawatts of capacity. By the end of the decade, the Joe Biden administration wants 80% of the United States energy to come from clean sources. This presents a unique opportunity to the Lucid Group and anyone else in the industry.
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