April was a rough month for stocks, with the S&P 500 index slumping 8.8%. Growth and tech names did even worse, and the electric vehicle (EV) sector was no exception. Lucid Group (LCID -0.91%) shares were down 28.8%, while start-ups Fisker (FSR -3.78%) and Workhorse Group (WKHS 3.30%) dropped 22% and 39.8%, respectively, according to data provided by S&P Global Market Intelligence.
The share prices of these companies weren't predominantly driven by specific business news last month. On that front, Lucid had several positive developments. It announced a new performance model of its Air Grand Touring sedan that it plans to begin delivering in June. Lucid's Grand Touring Performance model achieves zero to 60 mph in 2.6 seconds and delivers 1,050 horsepower, putting it in direct competition with Tesla's top performance Model S Plaid.
Lucid had previously announced plans to build a second manufacturing facility, and its first outside the U.S., in Saudi Arabia. The company has a long-standing relationship with the Saudi Public Investment Fund (PIF), which has a large stake in the EV maker. In April, Lucid announced a new order from the Saudi government to buy 50,000 of Lucid's electric vehicles, with the potential for another 50,000, all to be delivered over the next 10 years. Initial deliveries are expected to begin out of the company's existing Arizona plant by the second quarter of 2023.
Workhorse Group released some minor news in April, improving its balance sheet by converting some outstanding senior secured convertible notes into common stock. The company continues to struggle after it was forced to recall and redesign its electric commercial vans that had already been delivered to customers.
More important news came from both Lucid and Fisker after the month ended, with both reporting first-quarter financial and operational updates in early May. Fisker said it is on pace for its production to begin in November, and that reservations for its Ocean SUV have jumped about 50% to more than 45,000 since its last earnings call.
Lucid announced its first meaningful revenue of $57.7 million in the first quarter. It also said demand remains strong with reservations growing to more than 30,000, compared to 25,000 from its last update. Lucid also kept its production guidance for 2022 the same, but said it will raise prices about 10% to 12% depending on trim level, beginning with June vehicle orders.
Even with the stock's big decline, Lucid is still a $30 billion stock. That means much success is already built in, and that kind of speculative investment may not be for every investor. But for those with a long-term time horizon and a place for speculation in a portfolio, Lucid seems to be making progress even in the face of some near-term headwinds. That could make April's decline a nice opportunity for some investors in the EV sector.