In the first half of this year, global electric vehicle (EV) sales rose 168% compared to the same time frame in 2020. That level of sales growth has ramped up investors' excitement about EV stocks. It's also part of what fueled Tesla stock's stunning rise in 2021 (which only added to investors' EV enthusiasm).

Lucid Group's (NASDAQ:LCID) stock has risen 165% in six months. An amount of $5,000 invested in Lucid stock in May would have become more than $13,000 -- that's 2.6 times in just six months. The key question right now is, can Lucid stock generate similar returns over the long term? Let's discuss that next.

Exterior of a Lucid Air vehicle.

Image source: Lucid Group.

Lucid's growth plans

After delivering market-leading range, Lucid's next challenge is to ramp up its production. The company's manufacturing facility in Casa Grande, Arizona, has an initial capacity of 34,000 vehicles a year. That's enough to produce all of the 20,000 vehicles that the company targets to deliver in 2022. Moreover, the facility's capacity is expandable to 365,000 units. That's much more than Lucid's plans of around 50,000 vehicle deliveries in 2023.

In the long term, Lucid aims to deliver 500,000 units annually by 2030. A key part of Lucid's growth strategy is lower-priced models to target mass markets.

Lucid believes that as it could achieve 516 miles of range with just 112 kilowatt-hours (kWh) of battery pack, it could easily achieve a range of 300 miles or more with a much smaller battery pack. That would significantly reduce vehicle cost, making it suitable for mass markets. A range of 300-plus miles is something most EV models in the market offer right now. Geographically, the company plans to enter Europe and the Middle East in 2022.

Lucid plans to launch the Grand Touring, Touring, and Pure versions of Lucid Air next year. While the Grand Touring is priced starting from $139,000, the Touring and Pure versions are more affordable, starting at $95,000 and $77,400, respectively. In 2023, Lucid expects to start production of its luxury SUV, Gravity. In short, the company has laid out a systematic growth plan for the next several years.

Is Lucid stock a buy?

While Lucid and its cars surely look interesting, the same can't be said about the valuation of its stock. Lucid's capitalization of $87 billion exceeds that of Ford and is just a little less than that of General Motors.

LCID Market Cap Chart

LCID Market Cap data by YCharts

Then there is Rivian, which sports a market capitalization of more than $100 billion, though the company has delivered just 156 vehicles as of Oct. 31. If we compare the valuations of Lucid or Rivian to that of Tesla, the stocks seem to have a lot of room to run. However, Tesla was the first company to make electric vehicles mainstream and benefited from being the first mover. Electric vehicle space is far more competitive now. From legacy carmakers to EV start-ups, all are looking to capture a part of the EV pie.

That is not to say that these start-ups are all doomed. Companies that can deliver technologically better products at competitive prices are more likely to succeed in the long run. Lucid seems to have achieved a superb balance of a strong offering combined with the needed buzz to attract potential buyers. It is already a valuable brand name that customers would like to be associated with. While there is a lot that the company needs to deliver, it surely had the right start.

All the above should bode well for Lucid stock. Though I don't expect Lucid to generate Tesla-like returns, I think it has the potential to generate market-beating returns over the long term.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.