Lucid Group (LCID +0.28%) reported second-quarter results this week, and the stock plunged more than 10% on the news. The stock pared some of that drop but was still down 6% for the week as of Friday morning, according to data provided by S&P Global Market Intelligence.
Lucid CEO Silvio Napoli has been in the job for two months, and this week he let the market know exactly what his plan is. Let's look at what Napoli's "operational reset" for Lucid will look like.
Image source: Getty Images.
Napoli is tightening the company's focus to four strategic paths. While Lucid increased vehicle deliveries by 19% in Q2 versus last year, selling its current electric vehicle (EV) lineup is no longer a priority. Lucid's Air sedan and even its newer Gravity SUV are luxury vehicles with a limited market appeal.
The new CEO summarized his plan this way:
We are going back to basics, with a clear focus on cash, customers, and culture. We are focused on delivering on our four must-win priorities, including our $1.4 billion cash flow improvement plan and the advancement of our Robotaxi, AMP-2, and Midsize programs, which will establish a strong foundation for Lucid's next chapter.
Lucid is working with Uber Technologies and autonomous vehicle technology company Nuro for a robotaxi fleet program. AMP-2 is its manufacturing facility in Saudi Arabia, and the company is working to offer a smaller, more affordable model.
NASDAQ: LCID
Key Data Points
This new plan could be Lucid's last chance for survival. Buying the stock now would mean believing that the new CEO can successfully implement the new strategy on all fronts. That remains to be seen, and I would wait until progress is made before jumping into Lucid at this stage.
