Shares of Lucid Group (LCID -9.71%) are falling on Wednesday. The luxury electric vehicle (EV) maker's stock had dropped 9.3% as of 3:04 p.m. ET. The fall comes as the S&P 500 and Nasdaq Composite were up by 0.7% and 1.1%, respectively.
The stock is seeing a retreat after the company released its latest earnings report, underwhelming investors.
Lucid's Gravity SUV sales aren't where they need to be
The company's quarterly report revealed soft sales of its new Gravity SUV, a critical product for Lucid's turnaround efforts. The less-than-hoped-for SUV sales meant the company missed Wall Street's targets on its top and bottom lines. Lucid reported a loss of $0.24 per share on $259 million in sales when a loss of $0.21 per share on $280 million was expected.
Image source: Lucid Group.
CEO Marc Winterhoff addressed his frustrations with the performance, telling Yahoo! Finance: "This is something I've said before, and I say it again, we're not where we want to be with the Gravity at this time of the year. We actually wanted to be ahead, making significant ... progress every day," He said that the company's SUV sales would ramp up "drastically" in the second half of the year and help improve the lackluster numbers.
Challenges remain
Expectations for Lucid's early sales of Gravity weren't out of reach by any means. The fact that the company wasn't able to hit them speaks to the difficulty of selling high-priced EVs in this market. Demand for EVs and luxury goods isn't particularly strong at the moment, and competition continues to heat up from Chinese operators. I have serious doubts Lucid can execute a turnaround.
