Lucid Group (LCID -2.72%) stock had its largest intraday gain ever yesterday. Shares of the luxury electric vehicle (EV) maker gained as much as 45% before closing about 36% higher in Thursday trading. But investors are rethinking that move today.
Lucid stock sank as much as 8% this morning as investors digested two huge bits of news from yesterday. As of 11:50 a.m. ET, shares have recovered from that drop and remain near breakeven for the day.
Lucid's luxury Gravity SUV will be part of Uber's fleet of autonomous vehicles next year. Image source: Lucid Group.
Big news for Lucid, or just a head fake?
Lucid joined ride-sharing leader Uber Technologies and self-driving technology company Nuro in announcing a new partnership yesterday. The companies plan to deploy at least 20,000 Lucid electric vehicles (EVs) beginning next year for a premium robotaxi program exclusively for Uber's leading ride-hailing platform.
On the surface, that sounds like a massive win for Lucid. The company produced only about 9,000 vehicles last year and expects a total of about 20,000 this year. So it would represent a welcome backlog to Lucid's order book at a time when it needs to grow volume. The total EV deployment is expected to be spread over six years, however.
The deal includes a $300 million investment by Uber that will help deepen the relationship for autonomous luxury EVs on the Uber platform. The Lucid Gravity SUV enabled with Nuro's Level 4 self-driving system provides a 450-mile range on a full battery charge. That should help reduce expenses in Uber's vehicle fleet.
Lucid is still high risk
Along with the new partnership, Lucid also announced it plans to implement a 1-for-10 reverse stock split. A reverse stock split shows Lucid isn't coming from a position of strength. It still needs a broader customer base for its products.
One good sign investors can look for is a boost in 2025 delivery guidance when it reports its second-quarter update on Aug. 5. Lucid stock may tread water until then.
