American automaker Lucid Group has secured a substantial $1.5 billion in new funding from its majority shareholder, Ayar Third Investment Co., an affiliate of Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF).
Deal structure, funding details
The deal comprises a $750 million convertible preferred stock investment through a private placement and a $750 million unsecured delayed draw term loan facility, subject to certain terms and conditions, according to the company’s statement.
This financing aligns with PIF’s strategic goal of becoming a global investment powerhouse and the world’s most impactful investor. It aims to enable the creation of new sectors and opportunities that can shape the future global economy while driving Saudi Arabia’s economic transformation.
The additional funding also resonates with Lucid’s mission to accelerate the global shift towards sustainable transportation and energy through the development of the most advanced electric vehicles (EVs) available.
Liquidity expectations, utilization of funds
“The $1.5 billion commitment by a PIF affiliate is expected to provide sufficient liquidity into at least the fourth quarter of 2025,” said Gagan Dhingra, Lucid’s interim chief financial officer and principal accounting officer.
The company plans to utilize the funds from the private placement and potential term loan proceeds for general corporate purposes, which may include investments and meeting working capital needs.
Q2 financial results and production outlook
Lucid also announced its financial results for the second quarter, ending June 30. The company reported a revenue of $200.6 million, delivering 2,394 vehicles during this period.
Looking ahead, Lucid anticipates manufacturing approximately 9,000 vehicles in 2024 and ended the second quarter with approximately $4.28 billion in total liquidity.
“Our Q2 financial performance reflects the positive momentum of increased sales of Lucid Air and the results of our cost reduction efforts, which contribute to the journey toward improving gross margin,” Dhingra said.
Lucid’s CEO and Chief Technology Officer Peter Rawlinson expressed his excitement about the company’s sales and market share momentum, the benefits of its cost optimization programs, and the anticipation around the upcoming Lucid Gravity launch, which he believes sets a strong foundation for the rest of the year.
Rawlinson also highlighted Lucid’s landmark efficiency of 5.0 miles per kilowatt-hour, which he believes is a further proof point of the company’s leadership as a technology company.
In September 2023, Lucid opened its first plant outside the U.S. in Saudi Arabia, with an initial capacity of 5,000 EVs annually.
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