Lucid Motors Rejects Bankruptcy Rumours, Says Operations Are Fully Funded

Lucid Motors has denied reports that it is considering filing for Chapter 11 bankruptcy protection, rejecting claims that surfaced after an electric vehicle industry blog cited anonymous sources suggesting the company was weighing a financial restructuring or a move to become a private company.

Nick Twork, Lucid’s chief communications officer, said the reports were “completely false” and stated that the electric vehicle manufacturer has sufficient liquidity to continue operating well into next year. He also denied claims that Lucid’s board had formed a special committee to evaluate bankruptcy or similar restructuring options.

"The company has sufficient liquidity to carry its operations well into next year, as recently published in its last quarterly filings, and it has not formed any special Board committee to explore the scenarios reported today," Twork said. "Our focus is on improving execution, strengthening operations, and positioning Lucid to realize the full potential of its technology, products, and innovation."

The company issued its response after Lucid shares plunged more than 50% during Tuesday’s trading session, marking the largest intraday decline in the company’s history, according to Bloomberg News. The stock later recovered some of those losses and traded at $4.72 per share by mid-afternoon, remaining about 14% below its opening price.

The original report also claimed that the consulting firm AlixPartners had recommended that Lucid either pursue Chapter 11 protection or go private. Twork rejected that claim as well, saying AlixPartners is working with Lucid solely to improve operational performance and has not advised management or the board to pursue bankruptcy.

AlixPartners has previously worked with several struggling electric vehicle manufacturers. Lordstown Motors hired the consulting firm in 2021 as part of an effort to restructure its business following executive departures. However, the company ultimately ceased operations after its partnership with Foxconn unravelled. Faraday Future also retained AlixPartners in 2022 after an internal investigation led its board to recommend operational changes.

Lucid has been restructuring its own business ahead of the expected launch of a smaller, more affordable electric SUV later this year. The company recently appointed a new chief executive officer and has eliminated more than 2,000 jobs this year as part of broader cost-cutting efforts. Earlier this month, Lucid also announced plans to end a second production shift at its Arizona manufacturing facility, saying production would be aligned with anticipated customer demand.

The automaker delivered 3,953 vehicles during the second quarter, only slightly more than it shipped during the same period a year earlier. Despite receiving praise for the technology behind its luxury electric vehicles, Lucid has historically struggled to expand demand for its premium models.

Alongside its consumer vehicle business, Lucid is also preparing to launch a luxury robotaxi service with partners Uber and Nuro before the end of the year. Uber has committed to purchasing at least 35,000 Nuro-equipped Lucid vehicles over the coming years, including 10,000 Gravity SUVs and an additional 25,000 vehicles built on Lucid’s upcoming midsize electric vehicle platform.