Q1 2025 Lucid Group Inc Earnings Call
Andres Sheppard, Peter Rawlinson
LUCID representative: Hello, and welcome to Lucid's first quarter, 2025 Earnings Conference Call.
At this time, all participants are going to listen only mode
LUCID representative: After the speaker's presentation, there will be a question and answer session. To ask the question during the session, you will need to press star 11 on your telephone. You would then hear an automatic message advising your hand is raised.
LUCID representative: To withdraw your question, please first start one one again. I will now like to turn the conference over to Maynard Um, you may begin.
LUCID representative: These include, without limitation, statements regarding the future financial performance of the company, production and delivery volumes, vehicles and products.
Studios and Service Networks
LUCID representative: Financial and Operating, Outlooking Guidance, Macroeconomic, Policy and Industry Trends, Terrorist and Trade Policy, Company Initiatives and Other Future Events.
LUCID representative: These statements are based on predictions and expectations as of today, and actual events or results may differ due to a number of risks and uncertainties.
LUCID representative: In addition, management will make reference to non-GAAP financial measures during this call. A discussion of why we use non-GAAP financial measures and information regarding reconciliation of our gap versus non-GAAP results is available in our earnings press release issued earlier this afternoon, as well as in the investor deck.
LUCID representative: With that, I'd like to turn the call over to Lucid's interim CEO , Marc Winterhoff. Marc, please go ahead.
Marc Winterhoff: Thank you, Maynard. And I think everyone for joining us on our first quarter 2025 earnings toll.
Marc Winterhoff: I'd like to begin by expressing my sincere appreciation to our employees, customers, partners and shareholders.
Marc Winterhoff: Your continued belief in our mission is what drives us forward every day.
Marc Winterhoff: In the first quarter of 2025, we continue to make significant strides on both operational execution and strategic positioning.
Marc Winterhoff: We delivered 3109 vehicles up more than 58% year over year in our fifth consecutive quarter of record deliveries.
Marc Winterhoff: And this was despite very limited deliveries in Saudi Arabia due to a system change that has been fully resolved since then.
Marc Winterhoff: We produced 2,212 vehicles up 28% year-over-year. We also had over 600 vehicles in transit to Saudi Arabia. This will be counted towards production in Q2.
Marc Winterhoff: We saw a significant year over year improvement in Gross Margin, which was ahead of our guidance provided in our Q4 earnings goal.
While managing operating expenses
Marc Winterhoff: More recently, we completed a convertible notes offering with strong support from the public investment fund. I'd be remiss if I didn't personally thank them for their continued support and partnership.
Marc Winterhoff: Demand for the lucid air remains strong, and I'm proud to say that the 2025 lucid air was again named best luxury electric car by US News and World Report for the fourth consecutive year.
Marc Winterhoff: In the first quarter, the Lucid area remained the number one best selling EV, and the third best selling sedan overall in its segment in the US.
Marc Winterhoff: including gas cars from many of the most storied brands in the world.
Speaker Change: Thank you for watching. Please subscribe to my channel. See you in the next video.
Speaker Change: In the month of March, we were even the best-selling vehicle of any type in our segment.
In the U.S., according to third-party data, [inaudible]
Speaker Change: Many of our customers continue to tell us that once they experience the Lucid, it's hard to go back.
Speaker Change: That's what sets us apart, not just the specs but the way it feels to drive and live with on a daily basis.
Turning to the Lucid Gravity
We are very excited by the strong interest we're seeing.
Speaker Change: And one of the most recent significant moments was a special customer event in the meatpacking industry, just outside of our studio in New York City.
Our encounter extraordinary stunt, activation, delivered meaningful results for Lucid.
Speaker Change: On the course of one weekend, more than 3,000 people visited our New York store.
Speaker Change: leading to a significant increase in aided awareness, particularly among EV intenders.
Speaker Change: On social media, the campaign reached over 11 million people, driving some of our most significant followers and engagement growth to date.
Speaker Change: The Lucid Gravity is not just another SUV, it's a both lead forward in design, space, performance, and technological elegance
The reaction we received in New York.
Speaker Change: And in our recent media drive events, confirm what we've believed all along.
that the Lucid Gravity is a Game Changer.
Speaker Change: Mototrend said that the lucid gravity is as good as an EV SUV get.
Speaker Change: Edmunds Road, a Lucid 700 sequel, is almost a good to be real.
Speaker Change: Forbes added, the gravity is all around capability, establishes a new era in electrical SUV engineering.
Jalopnik: And Drelopnik said, Lucid Gravity's brilliant makes other cars seem pointless.
and many more. Thank you. Thank you.
Jalopnik: And the Lucid Gravity continues to attract new people to the brand, with more than three quarters of orders coming from those that are new to Lucid.
Jalopnik: You can expect us to significantly ramp up our marketing campaigns throughout 2025.
Jalopnik: And as we put greater emphasis behind building the Lucid brandless customers, we're thrilled to share
Jalopnik: That means signed a global ambassador who's reached across entertainment, culture and fashion will be a catalyst for our next phase of marketing and growth.
Jalopnik: We have a very special Lucid Gravity campaign we are currently producing and which will air soon. Thank you and an official announcement is forthcoming.
And this is just the start.
I'm pleased to welcome Ackerho, pronounced AK.
Jalopnik: Ogo, Ogo, Maynard to Lucid as Senior Vice President of Marketing.
Jalopnik: AK brings a wealth of experience to the Lucid team in building iconic brands including Red Bull and will play a key role in accelerating Lucid's marketing initiative.
Jalopnik: Increasing the reach and the relevancy of the lucid brand, strengthening consumer engagement and driving global growth.
Jalopnik: We continued deliveries of the Lucid Gravity to customers, including the first deliveries of the limited dream edition. In fact, we are delivering more Lucid Gravity as we speak.
Speaker Change: Thank you for watching. Please subscribe to my channel. I upload weekly. See you in the next video.
Jalopnik: On the technology, access and licensing side, we continue to see more interest and we had a number of new conversations.
Jalopnik: I think OEMs are starting to see our leading EV technology as complimentary to their scaling and manufacturing capabilities.
Jalopnik: We are also seeing more of an interest in the platform.
Jalopnik: Our powertrain hardware as well as our software and software defined architecture.
Jalopnik: Discussions are ongoing and are at varying stages with some much deeper maturity and some in the early stages.
Jalopnik: While many companies are currently focused on the terrorist situation and optimistic about the potential for our technology access and licensing business.
We've also seen interest in our manufacturing capability in Arizona.
Jalopnik: As OEMs look for more capital efficient strategies to make vehicles in the US, we've seen several inbound inquiries to discuss possible cooperation.
Jalopnik: It's still early and talks about preliminary, but the president and the administration want to have a strong manufacturing sector in the US, and we are looking at potential ways we can leverage our assets.
Jalopnik: The recent purchase of certain Nicola assets gives us further optionality.
While adding hundreds of more American jobs.
Jalopnik: So far we have come more than 250 former Nicolas employees with strong backgrounds in EV technology which will support our growth plans.
Jalopnik: We received a lot of questions about this, and I think it's worth highlighting the tremendous value we received.
Jalopnik: We paid approximately 17 million in cash plus the assumption of their two Arizona leases.
Jalopnik: Truly a great deal that allows us to gain assets that would have otherwise been significantly more costly by a huge factor.
Jalopnik: For context, these assets are valued at hundreds of millions of dollars.
Jalopnik: Thank you for watching. Please subscribe to my channel. See you in the next video.
We've also engaged with Strategic Partners in Saudi Arabia.
Jalopnik: And recently announced an AMOU with a Gingab Dula University of Science and Technology, or COST.
Jalopnik: House, World Class Research, Infrastructure and Talent, as the potential to further boost our technology leadership in many dimensions, including our ADAS and autonomous driving road map, bringing cutting edge innovation from the left to the road.
Jalopnik: As part of this corporation, Lucid will have access to cost high performance supercomputing capabilities.
Jalopnik: Significantly enhancing simulation capabilities and providing compute power to train our AI models for ADF and autonomous driving technologies.
Speaker Change: Thank you for watching. Please subscribe to my channel. I hope to see you again soon.
Speaker Change: It also dramatically enhances our ability to develop advanced materials, simulate real-world physics, model fluid dynamics and thermal transfer.
Speaker Change: Analyze Electromagnetic Flux, and accelerate AI training for autonomous systems, digital twin technology, and large language models.
Speaker Change: We are excited about this collaboration and thrilled about the breakthroughs it will drive across our engineering, autonomous driving and AI initiatives.
Andres Sheppard, Peter Rawlinson,
Speaker Change: On the autonomous vehicle front, we are in advance discussions with partners who have told us the Lucid gravity is the best positioned AV capable platform on the market.
Speaker Change: Lucid Gravity comes out of production at M4N with an AV capable sensor suite, redundant electrical and controlled architectures, and the latest SOC.
Speaker Change: If you think about what Fleet Operators care about, they essentially have two critical requirements.
The first is effort utilization, the second is operating costs.
Speaker Change: Lucid's leading technology enables both of those in ways that I believe no one else can.
Speaker Change: On asset utilization, longer range means less time for stops, while faster charging means less downtime to charge.
Speaker Change: On operating costs, greater efficiency means smaller battery for a given amount of range, resulting in lower charging cost, and a smaller battery without sacrificing range results in less weight which can result in less wear.
and Gagan Dhingra. Thank you. Thank you.
Speaker Change: On level four, we believe the industry has acknowledged Lucid's AV capabilities. Multiple L4 focus software and mobility companies have engaged Lucid about potential collaboration.
Speaker Change: On level two plus plus and level three, we've engaged with several companies to discuss accelerating L2 plus plus L3 development and our assessment, multiple paths forward.
Speaker Change: We are focused on delivering the best and safest solution to our customers, leveraging models that can quickly scale in multiple geographies, and optimizing Lucid's capex and op-ex to get a competitive product timely into market.
Speaker Change: Before I close, let me touch on the topic of towers, which we've been getting asked about frequently.
Tofiq will go through our guidance in more detail.
Speaker Change: But I wanted to highlight that the automotive supply chain is global.
And of course, I don't believe anyone can be Emmanuel.
We are in a better position than others.
Gave him that we produce all of our vehicles we sell.
Speaker Change: And major components like our drive units, battery modules and packs in the US in Arizona, but changes in policy bring about uncertainty until we get more definite clarity to be able to assess the full impact and consequences.
Speaker Change: And the macro impact to the consumer is also something that is uncertain to the consumer.
Speaker Change: But we've always been forward-thinking in our strategy and we've been proactively working towards localizing the supply.
Speaker Change: For example, although our 2170 battery cells from Panasonic today are produced in Japan, we expect future production at Panasonic's new production facility in Candles.
Speaker Change: We've also committed to sourcing battery raw materials in the United States, such as graphite from partners like graphite 1 and sera resources.
Thank you.
Speaker Change: We also engaged in a range of other optimization initiatives to mitigate some of the tariff impacts, including collaborating across the supply chain to share challenges and financial responsibilities.
Speaker Change: For example, when you look at rare earth metals, we can make the necessary technical changes
Speaker Change: We could potentially use entirely different rear earth metals as well without impacting performance.
Speaker Change: Those in the industry that outsource as many do, don't have the same level of flexibility or even technical know how to do that.
Thank you.
Speaker Change: But I also want to highlight again the importance of leading technology.
because of our high power density, D.
Speaker Change: The Lucid driving is actually used as a less rare birth content compared to others.
And Atlas will be even better.
Speaker Change: It's very similar to how our technology enables us to have a smaller battery for a given amount of range compared with our competitors.
Speaker Change: This underscores the importance of in-house technology, know-how, and I believe we are among the best in the world in that regard.
Andres Sheppard, Peter Rawlinson,
And it's not just having our factory in the US.
Speaker Change: I think something that's not well appreciated is the advantage of designing, developing and manufacturing your own technology in-house.
Speaker Change: By vertically integrating, we are able to have more control over certain components that are going to our vehicles.
Speaker Change: At the same time, we are exploring a variety of strategic adjustments to better line what are changing that landscape.
Speaker Change: Including the vehicle price changes, tarot risk mitigation, and bifurcating the supply chain.
Speaker Change: These efforts are expected to help support overall cost effectiveness and supply chain efficiency.
Speaker Change: So the world is rapidly evolving and we will be as nimble as we can.
Speaker Change: We are constantly evolving our strategy and examining our sorting plans.
Speaker Change: Some of this may take time, and as I said earlier, no one is likely to be in you, including us.
But relative to many other OEMs, we have some advantages.
Speaker Change: Our US manufacturing plant M1 is an Arizona and we vertically integrate our technology which provides flexibility.
Speaker Change: And we will have production and vertical integration in our new assembly plan in KSA, M2.
Speaker Change: We'll allow us to optimize our production location and supply chain strategies, utilizing this highly strategic geographic local.
Speaker Change: But of course, we'll remain attentive to policy developments and maintain open lines of communication with relevant stakeholders and government partners.
Speaker Change: In closing, we are not here to follow the EV playbook. We are here to rewrite it with the Lucid air, now with the Lucid gravity and in the near future our missile platform variants.
Speaker Change: We have a world-class team driving innovation every day, and I feel Lucid is positioned better than it has ever been before. The road ahead is exciting, and we're just getting started.
Speaker Change: Thank you for your continued support and for believing in what Lucid represents.
Speaker Change: Not just a car company, but as a catalyst for what's possible.
Speaker Change: With that, I'd like to turn it over to Tobias to provide an update on our financials.
Taufiq: Thank you, Marc, and thank you to those who are taking the time to join us today. It's a pleasure to be here with you for my first full-earning call as CFO of Lucid Motors.
Taufiq: Since joining, I've spent time across the organization, with our engineering teams, our factory floors, our commercial teams and our partners, and what stands out is the deep sense of mission.
Taufiq: and the shared belief in what Lucid represents, not just building remarkable EVs, but leading the transformation of the automotive industry through innovation, performance and sustainability.
Taufiq: We know that delivering on this mission requires more than just great technology, requires discipline, financial, operational and strategic, and is quarter with made meaningful progress on all three fronts.
Taufiq: Let me walk you through the highlights of the quarter and how they fit into our broader strategic agenda.
Speaker Change: One of my top priorities at CFO is ensuring that Lucid has the financial strength and flexibility to scare responsibly in Q1. We took two important steps to bolster our liquidity and financial resilience.
Speaker Change: In February , we renewed and upsized our GIB Credit Facility in Saudi Arabia, increasing the commitment by approximately 240 million dollars.
Speaker Change: In April , we closed 1.1 billion dollars convertible senior not offering due in 2030.
Speaker Change: which included the full exercise of the $100 million over a lot of adoption, and we used $935.6 million of the net proceeds to repurchase approximately $1 billion in principle of our outstanding 2026 notes.
Speaker Change: Both transaction-demonstrated strong institutional support, particularly from the public investment fund, our strategic anchor investor, and extend our liquidity runaway into the second half of 2026, even before factoring in additional financing sources.
Speaker Change: like Saudi Industrial Development Fund or the Ministry of Industry of Saudi Arabia Grants.
Speaker Change: These actions are part of a deliberate strategy, maintain balance sheet strength while minimizing shareholder delusion, and do so in a way that supports our long-term growth ambition.
Speaker Change: Now, turning to Q1 results, we produce 2,212 vehicles, 28% year-over-year increase, and delivered 3,109 vehicles, up more than 58% year-over-year
Speaker Change: Importantly, this was achieved despite temporary systems issues in Saudi Arabia that have now been fully resolved.
Speaker Change: Porter Avenue for the quarter was $235 million, representing 36% growth year-over-year
Speaker Change: We also recognize 31.5 million dollars in regulatory credit revenue, a significant contribution and an area where we see continued opportunity.
Speaker Change: Rosmargin improved meaningfully, on a gap-based Q1 Rosmargin was negative 97.2% up from negative 134.3% in the prior year quarter.
Speaker Change: Continued focus on customer transformation and discipline execution. When adjusting for one time supplier recovery benefiting Q4, we delivered over a thousand basis points of sequential improvement.
Speaker Change: Let's turn to operating expenses. In Q1, R&D was $251 million down from Q4, largely due to the lower Lucid gravity related development expenses.
Speaker Change: However, we expect R&D to increase throughout the year as we accelerate investments in our mid-sized program and in the Atlas powertrain platform.
Speaker Change: S.GNA was $202 million, a 13% sequential decline, the change was primarily attributable to a reversal of $35.4 million, related to previously recognized stock-based compensation expenses.
Speaker Change: This reversal is one time in nature, and we expect this to normalize in the second quarter.
Speaker Change: Combined with seasonal growth and marketing initiative that we signaled last year, we would expect a more significant sequentially increasing S.G.N.A. in the second quarter.
Speaker Change: We're continuing to focus on efficiency, but we are also investing where it matters, including brand building and expanding our commercial reach.
Speaker Change: Adjusted every tie into one with negative $563 million, and improvement of 2% versus Q4.
Speaker Change: Moving to the balance sheet, our liquidity position and the strategy deployment of capital, we ended Q1 with approximately $4.56 billion in cash and investment and total liquidity of $5.76 billion.
Speaker Change: This provides a strong platform from which to execute on our long-term strategy.
Speaker Change: Inventory increased to $471 million up from $408 million in Q4 as we ramp up the production of the Lucid gravity. This is in line with our build plans and expectations.
CapEx for the first quarter came in at $161.2 million $161.2 million.
Speaker Change: Now, turning to our outlook, the level of uncertainty has increased since our last turning course, as Marc indicated, we've been working on ways to mitigate some of these impacts.
Speaker Change: But, adversity is not new to Lucid, and we have always been a nimble company. We build a greenfield EV factory during a time of tremendous turmoil during COVID when not just getting part, but also getting people with challenging.
Speaker Change: We faced incredible supply chain disruption during the time when some of our suppliers were forced to shut down factories.
Speaker Change: We were able to do this through the resilience of our team, a strong partnership with our supply chain, and the determination that I believe is embedded into the DNA of the company.
Speaker Change: Last quarter, we provided the potential gross margin headwind of 7-20% based on the tariff impact as we were aware of at the time of our Q4 earning calls back in February .
Speaker Change: Based on what we understand today and the best information we have, we see the potential impact in range of 8 to 15%.
Speaker Change: This is a challenging situation and outcome on our financial performance depends upon various underlying factors including market volatility and regulatory challenges.
Speaker Change: And as a result, the ranch could further change. Although the situation remains fluid, we are taking efforts to mitigate the impact as best as we can.
Speaker Change: Turning to production, we focus production of approximately 20,000 vehicles in 2025, although there are many uncertainties in the market we believe we have some potential levers if market dynamics were to fluctuate but we feel this is still an appropriate target.
Speaker Change: With regard to our liquidity position, we ended the quarter with the total liquidity of approximately 5.76 billion dollars which we believe provide us runway into the second half of 2026.
Speaker Change: I would also highlight that this does not include potential future Saudi industrial development and sound loans or ministry of industry of Saudi Arabia grants.
Speaker Change: Moving to CapEx, we believe in the large opportunities for Lucid ahead of us and will continue to invest for growth. We expect capital expenditure for 2025 to be approximately $1.4 billion, which include investments in our...
Speaker Change: M1, M2, and retail infrastructure. That said, I believe we have potential levers here as well if market dynamics were to change.
Speaker Change: From a product perspective beyond the Lucid air and the Lucid gravity, we plan to expand our vehicle line up with upcoming mid-size platform, which is scheduled for start of production in late 2026.
Speaker Change: Introducing a new vehicle is always challenging and complex, particularly at our rapid pace and we are leveraging insights gained from our lucid gravity production ramp by planning for our mid-size production.
Speaker Change: The highly uncertain macroeconomic environment and swift moving trade policies further complicates these efforts and we are diligently working to optimize our supply chain and manufacturing plans for our mid-sized platforming response.
Speaker Change: In closing, let me leave you with this. We're building more than a car company. We're building a technology driven capital discipline vertically integrated enterprise designed to lead in the next era of mobility.
Speaker Change: We're executing against our new term goals, driving volume, improving margin, and operating with rigor.
Speaker Change: And we're positioning ourselves for a long-term value creation, with the clear strategic priorities, strong liquidity, and breakthrough products that redefine what EVs can be.
Speaker Change: To our employees, partners and shareholders, thank you for your continued trust and belief in Lucid. With that, I'll turn it over to Maynard to take your questions.
Speaker Change: Thanks, Tooufiq. We'll now start the Q&A portion of the call. Before we take questions for those on the phone, I do want to pose some questions that are retail investors sent in through the SAID technology platform. Thank you for your time.
Speaker Change: Question 1 is from Carthic A. With the acquisition of the Nicola factory can mid-size roll-out and ramp be accelerated than previously planned, second half 2026. Also, does this acquisition minimize the capital expenditure than previously planned?
Speaker Change: Maybe I'd take the first part to who can you take the second part of that. First of all, I would like to clarify, it says in the question, second half of 2026, we always talked about them to figure out that earlier in the prepared remarks late 2026.
Speaker Change: Um, and it may not be well appreciated by, but the pace that, which Lucid has been able to bring Lucid Air and Lucid gravity to market was already incredibly fast and much faster than most
Speaker Change: These were incredibly complex programmes with substantial challenges that we had to overcome and are overcoming. The mid-size is just as difficult. And on top of that, uncertainty around terrorists and the supply chain adds an additional layer of complexity. [inaudible]
Speaker Change: We are in the midst of sourcing and are about to make major sourcing decisions, hence we need to take the necessary time to fully evaluate the impact of current development developments to ensure we make the right business decisions.
Speaker Change: For the long term, which is difficult to do in a rapidly shifting tariff environment.
Speaker Change: We are already working at a pace in the timeline that is very aggressive, so I would say unfortunately accelerating mid-size isn't possible.
Particularly in this environment.
Speaker Change: I want to say it so that the distinguishing attributes of the lucid air and lucid gravity will be definitely coming to midfielder.
Speaker Change: You can see all of the positive reviews about the Lucid Gravity. I love the Lucid Gravity, but I think the mid-size platform is going to be an even bigger game changer.
Speaker Change: But we've got to focus on getting it right, not just getting it out.
Tobias Beith,
Speaker Change: So on the Nikola assets specifically, I think it's important to make the point that that was the highly attractive financial deal for us. So just to put things into perspectives for hundreds of millions in assets, we did pay approximately 17 million dollars in cash.
Plus, Trulies in Arizona that we have assumed. So, I think that this...
Speaker Change: Could mitigate some of the topics that we will need to spend for the time being we're maintaining our topics guidance of 1.4 billion dollars, but I definitely see opportunity for this to be better in 2025.
Speaker Change: Great. Thank you. Question number two is from John G. And there's actually another question related to the same topic from Chiwa H. Are there any plans for Lucid to sell or lease its technology to other car manufacturers in the future?
Speaker Change: Yes, that always has been the plan and this is why we actually named the company Lucid Group, not Lucid Motors.
Speaker Change: In fact, as to Martin was our first OEM contract and as I said multiple times earlier, we're in active discussions with many other companies.
Speaker Change: But of course, many OEMs today are very preoccupied with Taris and this might obviously take some of their focus but I mean encouraged it by the amount of the discussions we're having and the progress.
© transcript Emily Beynon
Speaker Change: Thank you. And question number three is again from Carthic A. What is the impact on lucid supply chain as a result of Chinese curbs on export of rare earth material to what extent is lucid exposed to the tariffs?
Speaker Change: I think the second part of the question we already addressed in the prepared remarks, even the first one, but let me reiterate that this was why designing, developing and manufacturing your own technology is so important.
Speaker Change: There are very few companies that we are aware of that can do this to this end.
Speaker Change: Because of our vertical integration we are able to have more control over various components that go into our vehicles.
Speaker Change: Not only does our high power density drive units in the lucid air and lucid gravity require significantly less material, including a very low ratio of this prosium and Tobium, but we could potentially use completely different rare materials without impacting vehicle performance.
Speaker Change: We are always evaluating our supply chain and we will continue to deliver the award-winning performance and experience that our customers expect every time they step into a Lucid.
Thank you. Thank you. Thank you.
Speaker Change: Thanks Marc, and our last say question is from Patrick M. Is it fair to say that Lucid lacks urgency with regard to production rampant deliveries? Gravity's timeline seems especially slow a year from unveiling two orders opening, 51 more days to make 50 cars, friends, and family, and nothing to show in the four months since.
Speaker Change: Well, we appreciate your passion and share your sense of urgency.
Speaker Change: Bringing a high quality vehicle to market, especially one that we believe will be a long-term category leader, requires thoughtful execution.
Speaker Change: Let me start by reiterating that we brought the lucid gravity to market at a pace faster than most are capable capable in the industry.
Speaker Change: While we encountered a modern supply chain bottleneck that has impact on our timeline, the more important point is that we're taking the time to get it right, not just getting it out.
Speaker Change: Our focus remains on delivering a product that meets the very high standards that our customers expect and that will drive long-term value for our shareholders.
Speaker Change: And, in fact, we just recently delivered the very first Lucid Gravity Green edition, and deliveries continue today, we expect to start ramping further soon.
Speaker Change: Great, thanks. Now we'd like to take questions from the phone lines. Twanda, can you give instructions? Thank you. Ladies and gentlemen, as a reminder to ask the question, please press star 1-1 on your telephone, then wait for your name to be announced.
Speaker Change: To withdraw your question, please first start one one again. Please stand by while we compile the Q&A roster.
Speaker Change: Our first question comes from the line of Steven Gengaro, with Steve Ful, Yaline is open.
Ah, thank you. Good afternoon, everybody.
Speaker Change: Um, I think the first, the first one for me is, you know, having been lucky enough to experience the gravity. I would imagine as you...
Speaker Change: As you get people in the seat, you'll start to see pretty significant interest. Tell us where you stand, kind of on test drives and what you're seeing, maybe just call it qualitatively from an order perspective at this point.
Speaker Change: Yeah, I can take that. From the orders perspective, we continue to see strong order inflow.
Speaker Change: We only have open so far the the ordering for our higher grant touring twin and we actually see very good numbers continuing way above the GT off of the air.
Speaker Change: We also have launched a kind of little bit off the record, a limited edition, the dream edition, which is almost sold out.
Speaker Change: There are only a few available until we reach the limited number that we wanted to do. So all in all, we still see very high demand and interest in the vehicle.
And, as you rightly said, Ed.
Speaker Change: It only increases when people are actually sitting in the car. And when it comes to test drives and studio cars, we are about to roll this out, not all of the studios have their test drives and studio cars but we are basically delivering those cars as we speak. [inaudible]
Speaker Change: Great, thank you, and then I might have missed this on the call, but do you have an update on where the Atlas Drive Cream sits right now?
Speaker Change: Yeah, I do. We're not actually announcing something today, but that is something for maybe the next few months or quarters where we then announce the at us drive frame. We actually are actively discussing when are we doing this.
Okay, great. I'll get back in line. Thank you.
Thank you. Please stand by for our next question.
Speaker Change: Our next question comes from the line of Andrea Sheppard with Candra Fitzgerald, Yalana Seltin.
Andrea Shepard: Hi everyone, good afternoon, congratulations on the quarter, and thanks as always for taking our questions.
Andrea Shepard: Um, I want to just maybe touch on the 2025 outlook. So, you know, guidance is reaffirmed or unchanged at 20,000.
Andrea Shepard: I guess like, how should we think about the breakdown between the sedance and the gravity both in terms of maybe production and
Andrea Shepard: Deliveries for this year. I think in the past you had mentioned, I think the sedans, the purers will be relatively flat the last year and the Delta perhaps coming from the gravity. Just any color you can give is there. Basically we're trying to figure out, you know, what's the best way to think about ASPs for the rest of the year. Thank you.
Andrea Shepard: Yeah, I can take that. I mean, the expectation has not changed from what we said last time.
Andrea Shepard: I mean, we're expecting the air, actually it sells pretty well right now, I'm not in, you know, in the, in the Pepe tree marks. I said that in March, we were actually the best selling car in our segment, not only EV best selling car in our segment. So
Andrea Shepard: It's, you know, air is going going well, but in in general, we're not expecting the air, you know, to drastically increase in sales. So then the balance will have to come from gravity.
Andrea Shepard: How is now exactly turned out by the end of the year? We remains to be seen, but that's kind of what we are planning for right now.
Andrea Shepard: And maybe on the air just to implement because you also had the question about the ASP so I mean the expectation is that you should see the expect the ESP is improving towards the second half of the year with the gravity is representing higher volume in our overall mix.
Speaker Change: Okay, when you say improving, in this case, you mean lowering, correct? The blended ASP? No, no, no, no, no, no, ASP's will go up because, yeah, they will increase.
Speaker Change: Okay, got it. Super helpful. And then just a maybe quick follow-up on liquidity. So total liquidity is just shy of about six billion.
Speaker Change: You touched on this before, but can you remind us again kind of the plan to address the convertible bonds maturing in 2026? I believe the recent...
Speaker Change: Capital Injection will be used to offset that but can you maybe just remind us what you've said there and kind of what the plan is thank you.
Speaker Change: Well, I mean, we didn't really specify the plan and the timing in terms of execution. I mean, what we have always said is that, I mean...
Speaker Change: Historically, we have been very opportunistic, we will continue to be very opportunistic, the way we have executed
Speaker Change: The founding for the convertible bond or half of the convert, I mean, does demonstrate.
Speaker Change: The fact that we are very nimble when it comes to executing this kind of transaction, it was a very successful transaction, very well executed, where received by the market, and that was very encouraging for us. So it gives us confidence for us to be able to drive the next.
Speaker Change: The next phase of what we need to do, we are not communicating about the timing, because again as I said
Speaker Change: We want to be in a position to choose the right timing and do things when we think it's the right time, not when we have to do them.
Speaker Change: Got it. That's super helpful. I appreciate all that context. Congrats again. We'll pass it on.
Thank you. Thank you.
Please stand by for our next question.
Davis Thunderland: Our next question comes from the line of Davis Thunderland with Bayer, Yolani's Open.
Davis Thunderland: Hey, good afternoon guys. Thank you, Marc and Taoufiq for taking the questions. Maybe just to start going back to your prepared remarks, Marc, about the Chaos Partnership.
Davis Thunderland: Could you just expand maybe a bit on the resources either financial or through personnel that you and your partner might be committing where the R&D focus might be out of all those different areas you outlined, and then I have one follow-up.
Yeah.
Davis Thunderland: So, the financial, yeah, there's actually not much financial commitment involved from our side, and that is actually going to be further discussed. I mean, right now, we are in an MOU phase, but I want to reiterate how much, you know,
Davis Thunderland: Benefits that brings to us. I mean, the Coast University has very strong resources across many, many areas, but for us.
Davis Thunderland: One of the major things is really about the computer power that we can have access to.
In a very efficient cost efficient way for us.
Davis Thunderland: particularly around AI models for for Edas and for autonomous driving, but that's not the only thing, you know, developing new materials and, you know, simulation be it crashed in relation or through it related.
Davis Thunderland: There's a lot of things that we can do together, which will increase our capability to, yeah.
Davis Thunderland: to further develop our leadership in EV technology, but also then leadership in the areas of autonomous driving and then data. So it's a really, I cannot stress enough how, how, yeah.
Davis Thunderland: and Beneficial, that is for us. It's a little bit similar like the Nicola deal. We said this earlier, maybe a little bit underappreciated how valuable that was for us. And this is another, let's say, stepping stone of things where we make smart choices in order to help our business. [inaudible]
Speaker Change: And maybe just to reiterate what Marc has said, I mean from a financial standpoint, I think that we need to look at this partnership as an asset-like way for us to accelerate our go-to market.
Speaker Change: And I think it's really important to remind everyone about that because it gives us...
Access again to a compute power. For
Speaker Change: We actually have no financial commitment from our side with strong benefit of allowing us to accelerate our Gautamarket.
Speaker Change: That's super helpful. Thank you. And then maybe just for my second.
Speaker Change: Totally acknowledge your points about other OEMs being preoccupied with tariffs, but just wanted to ask, do you see a scenario potentially where all the global uncertainty and the tariff talk actually increases interest in some of your technology just as OEMs want to increase their use of US components?
Speaker Change: Um, and I know you talked in the past about a licensing model specifically, but would you guys ever consider being a manufacturer of certain components for a customer giving your excess capacity and maybe some of the new nickel assets?
Thank you guys.
Bye.
Speaker Change: Well, actually, this is part of our aspect, not in the other first one that we signed, we are actually a supplier or a manufacturer for the powertrain or the whole drivetrain technology for them.
And so we're not opposed. And so we're not opposed.
Speaker Change: I guess when it comes to doing this in a broader scale, you know, we always have to consider, well, we want to build our own cars and we need our capacity for that.
Speaker Change: And we want to focus on that, but it's not out of the picture. And I'm glad you brought the Nicola topic up because yes, absolutely. I mean this gives us more options to do things like that. And as a matter of fact, I mentioned that in the prepared remarks we had...
Speaker Change: Several players reaching out to us, you know, exploring, you know, joint manufacturing in the US, given that we have now additional assets that we can leverage. So yes, we can envision that absolutely.
Thank you very much.
Speaker Change: Thank you. As a reminder, ladies and gentlemen, that star one one to ask the question.
Please stand by for our next question.
Speaker Change: Our next question comes from Milan, Tobias Beith, with Rick Bern, Edeland, Yelana Sopin.
Speaker Change: Great, good afternoon. Thank you for your time to speak and mark. I have two questions which are separately if that's okay. In the near term, not to be philosophical, but total work hours can be thought of as being a semi-fixed resource.
Speaker Change: And I was wondering if Lucid would divert time to re-architect existing supply chains for the air and the gravity at the potential detriment to the mid-size platform timeline.
The end is no
Speaker Change: No, we are working right now with a very strong focus.
on Mid-Size.
Speaker Change: And we are not making decisions to rework supply chain on our existing products to Amper.
anything on on with size. So I want to be
Speaker Change: First look clear on this, it doesn't mean that we're not working on air and gravity supply chain, we actually do that. But, you know, particular to your point at the detriment of mid-size the answer is a clear no. [inaudible]
Speaker Change: Alright, that's helpful to have confirmation. Thank you, Marc. Secondly, the journalist event in April has mostly positive feedback on the gravity, which is great. But several reviews, some of which you highlighted in your opening remarks, mentioned sit, finishing, technology issues.
Speaker Change: And then Duzias Forum also indicates that many studios are yet to receive permanent test deals.
Speaker Change: My question is whether the state of the vehicle and its derivatives for the touring and whatever else that follows are on track versus your expectations at the start of 2025.
Speaker Change: Yeah, I mean, the, I think we, we stated the right stated that also that we, you know, now actually continue deliveries to, to customers.
Speaker Change: I'm following this very very closely, as a matter of fact this morning, I checked how many we had this morning so deliveries are still happening.
Speaker Change: It is true that we had some technical issues that we had to overcome around software, but also on the topic around HUD, the head-up display you probably have heard that
Speaker Change: We basically disentangled the technology package and took the hot optional because that is one area where we had issues with the supplier not ramping up at the level our customers wanted actually the technology package. Now that we have untangled that we can continue to build vehicles because it's not only the hot itself involved it's also different harnesses and other things that you have to change.
Speaker Change: And so with that move we were now able to continue and scale up our deliveries.
Speaker Change: And other things were around software updates that we had to do which are now have been done as well. So yeah, there have been some hiccups to be quite frank. I think this is absolutely normal in the beginning of launching a vehicle. So
Speaker Change: And, but we're now, we're basically one after the other knocking those out and...
Speaker Change: That's also why we delivered let's vehicles to studios and to do for test drives because we want to only do that if we have the standard that, you know, we promise to our customers and we rather push it out a few days or weeks rather than, you know...
Putting half-baked product in front of the customer.
Sure, I can completely understand and get that.
Speaker Change: Roundpops have a natural learning curve. Thanks a few time both for the forward speaking soon.
Thank you. Thank you.
Thank you.
Please say bye for our next question.
Speaker Change: We have a follow-up from the line of Steven Gengaro with Sifu, Yolanda Sifu, Yolanda Sifu.
Steve Dhingra: Thanks for taking the follow-up. I'm not sure you'll want to come in directly on this, but I'm curious, can you talk about with the gravity production ramping?
Speaker Change: Like, how do you think about the sort of the timing and the person takes towards, towards gross margin?
George Marge is moving towards break even and profitability. Is there anything you can kind of talk about that helps frame that for us?
Speaker Change: Well, we didn't specifically guide about the timing of us reaching the break even. But I think that it's important as well to insist on the fact that the key lever for us to reach the break even is the scale.
Speaker Change: So, gravity will definitely contribute to our path, to allow us to reach that scale which will lead us.
Speaker Change: to the break even, but the real program which will allow us to mitigate the fixed cost on the absorption is the meat size.
Speaker Change: Yes, okay, thanks. I think that's all for me. I appreciate the information.
Thank you.
Speaker Change: Ladies and gentlemen, due to the interest of time, that concludes today's conference call. Thank you for your participation. You may now disconnect.