Lucid Group (LCID -3.04%) stock is soaring today after the company announced a major new deal in the robotaxi space. The company's share price was up 40.2% as of 1:30 p.m. ET amid the backdrop of a 0.4% gain for the S&P 500 and a 0.7% jump for the Nasdaq Composite.
Uber Technologies announced today that it has selected Lucid as a key vehicle provider for its robotaxi initiatives. The ride-hailing company will be purchasing the vehicles from Lucid and operating them using autonomous-vehicle software from Nuro. As part of the deal, Uber has also purchased a $300 million stake in Lucid.
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Is Lucid stock a buy right now?
Lucid's long-term success still hinges on scaling its vehicle production and delivery numbers to the point where it sees enough benefits from economies of scale to generate positive margins on each electric vehicle (EV) it sells. Uber expects to roll out 20,000 or more Lucid vehicles with its robotaxi software over the next six years.
Uber's Lucid robotaxis are slated to launch next year in an unnamed major U.S. city. The deal with Uber is likely to be a substantial positive demand catalyst for Lucid. In conjunction with the news, the EV specialist submitted a filing with the Securities and Exchange Commission (SEC) stating that it plans to move forward with a 1-for-10 reverse stock split.
While the Saudi Arabian Public Investment Fund (PIF) remains Lucid's largest shareholder and will likely continue to bankroll the business and provide it with operating capital as it posts large losses in the quest to scale its operations, it's encouraging to see Uber come on board as a major investor and partner. Despite the big valuation pop for the stock already seen in today's trading, the deal with Uber looks like a substantial buy signal for Lucid stock if you were already considering an investment in the company.
