Shares of electric vehicle maker Lucid crashed by more than 50 percent as rumors surfaced that the company is exploring extreme survival strategies.
The panic was sparked by a report from Electric-Vehicles.com, which claimed that Lucid’s board has retained turnaround and restructuring specialist AlixPartners to evaluate its ongoing financial viability. According to anonymous sources cited in the report, the advisory firm has been tasked with presenting options ahead of an upcoming board meeting.
The most alarming of those scenarios reportedly include launching a take-private transaction or filing for Chapter 11 bankruptcy protection.
The report alleges that AlixPartners is actively urging Lucid's leadership to execute a targeted restructuring program across its North American and European operations.
The strategy would require Lucid to narrow its operational focus almost entirely onto the production of the Gravity SUV while scaling back resources elsewhere. The same Gravity SUV no one seems to be buying, prompting the automaker to offer six-year, interest-free loans to anyone who will take one home.
While Lucid's board has not officially committed to a path forward, the mere mention of restructuring advisers sent investors sprinting for the exits. At one point, the stock plummeted as much as 57 percent, hitting an all-time intraday low of $2.37 per share.
Lucid issued a swift, public denial, labeling the restructuring report as "completely false." In an attempt to restore market confidence, the luxury EV maker said that it currently maintains a sufficient liquidity buffer to completely fund its operations well into next year.
Lucid clarified that while AlixPartners is indeed embedded within the organization, the firm was hired strictly to optimize day-to-day operational execution and supply chain efficiency—not to draft a Chapter 11 filing.
The luxury EV brand has been plagued by extreme cash burn and a recent supplier quality crisis that paralyzed early Gravity SUV deliveries. Even with heavy financial backing from Saudi Arabia’s Public Investment Fund, Lucid's equity value has collapsed by approximately 99 percent from its all-time post-IPO highs.
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via Autobuzz Today
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