In its efforts to boost production and working capital, the luxury electric vehicle maker Lucid Group plans to raise $8 billion through new offerings at a time when supply chain disruptions and shortages of parts and raw materials are forcing EV manufacturers around the world to struggle to control costs.
According to the primary prospectus Lucid – which counts among its backers Saudi Arabia’s sovereign wealth fund, the Public Investment Fund – filed with the Securities and Exchange Commission in the US, the company plans include raising funds from mixed offerings and from the occasional sale of different types of securities with their size, price, and terms to be determined at the time of sale.
The company, which has a market value of about $27bn, said that its offerings may include selling “common stock, preferred stock, depository shares representing preferred stock, debt securities, warrants, purchase contracts or units in one or more offerings of up to $8bn in aggregate offering price”.
Citing extraordinary supply chain and logistics challenges, Lucid halved its 2022 production forecast earlier this month to between 6,000 and 7,000 luxury Lucid Air EVs from the 12,000 to 14,000 EVs targeted in February.
Back in April, the Saudi government signed a purchase agreement with Lucid for 100,000 cars – including the flagship Lucid Air and other future models – to support Riyadh’s sustainability drive.
The agreement – which covers a 10-year period – includes an initial commitment to purchase 50,000 EVs, plus an option for up to 50,000 additional cars over the same period.
Several Saudi entities, including the Ministry of Investment, the Saudi Industrial Development Fund (SIDF), the Economic City at King Abdullah Economic City, and the Gulf International Bank, signed a formal agreement with Lucid in May to help it set up a factory in the kingdom.
That agreement will provide Lucid with financing and incentives worth $3.4bn over the next 15 years to build and operate the manufacturing center which is expected to produce 155,000 EVs a year.