Shares of Churchill Capital IV (CCIV) were trading lower on Wednesday. The special-purpose acquisition company (SPAC), which has been linked to prominent electric vehicle (EV) start-up Lucid Motors, fell after The Wall Street Journal reported that a deal with Lucid isn't imminent.
As of 2:45 p.m. EST today, Churchill's stock was down about 6.2% from Tuesday's closing price.
Shares of Churchill have surged more than 200% since Bloomberg reported on Jan. 11 that the SPAC was close to a deal to merge with Lucid, a start-up manufacturer of luxury EVs that is close to beginning production of its first model.
It's easy to see why auto investors might be excited about such a deal. Lucid is one of the most prominent EV start-ups founded to challenge Tesla (TSLA -1.36%). It has an impressive management team, a promising product (the Air luxury sedan), plenty of pre-orders, cash in the bank, and an Arizona factory that's nearly complete.
Simply put, it's as close to a complete package as you're likely to find, as least among automakers that aren't public and haven't yet shipped vehicles to customers. (The only peer that comes to mind is Michigan-based electric-truck start-up Rivian, and Lucid will almost certainly ship first.)
Given how the stocks of other EV start-ups have soared over the last year, it's no surprise that many investors would like to invest in Lucid. That's why Churchill's stock has run up over the last few weeks, and the Journal's report -- that no deal is imminent -- is why it's down today.