The electric vehicle industry is in turmoil from demand collapsing.
Now a day of reckoning is here for one of the upstart automakers.
And Joe Biden was at a loss for words when this electric vehicle darling gave him scary news.
Lucid Motors announces major layoffs
The electric vehicle market has seen demand begin to decline despite a $7,500 tax credit from President Joe Biden and plenty of hype in the media.
And that’s forced automakers to make some painful decisions in response.
Electric vehicle maker Lucid Motors announced that it was laying off 6% of its workforce of roughly 400 employees, from top leadership on down.
The company will have to pay out between $21 million and $25 million in benefits and severance packages as part of the layoffs.
“As always, we must remain vigilant about costs. We are optimizing our resources in a way we believe will best position the company for future success and growth opportunities as we focus on achieving our ambitious goals,” CEO Peter Rawlinson said in a company email published by TechCrunch.
Last March, Lucid laid off 18% of its workforce, 1,800 employees.
The electric vehicle was founded by a former Tesla executive who hoped to follow a similar path to success by producing luxury vehicles.
Lucid lost $685 million in the first quarter of 2024 and has yet to turn a profit since the company was founded.
Currently, the automaker only offers one vehicle, the Lucid Air, which was named Motor Trend’s 2022 Car of the Year.
The automaker is planning on releasing an SUV, the Lucid Gravity, later this year.
But it remains to be seen if there’s a path to profitability for Lucid with demand falling for electric vehicles.
Lucid lags far behind industry leader Tesla in vehicles sold.
And Gravity’s expected base price of nearly $80,000 raises questions about how much demand there will be for it in the increasingly crowded electric vehicle market.
Electric vehicle makers made major cutbacks this year
Democrat politicians like Biden promised the future for electric vehicles was bright.
The future for them is cloudier than ever after a dismal start to the year.
Their sales have begun to slow during the first quarter of 2024.
The drivers who want electric vehicles have made the switch, and the rest of the consumer market doesn’t want to be forced into a Bidenmobile.
Tesla announced that it was laying off over 10% of its workforce in April after deliveries came in at their lowest levels since the pandemic.
Rivian – another Bidenmobile darling – also announced layoffs in April, which marked the third straight year it cut staff.
Established automakers like Ford, Mercedes-Benz, General Motors, Bentley, and Honda all announced plans to scale back their electric vehicle targets.
The industry is facing the threat of Chinese electric vehicle makers that have begun to conquer foreign markets with their lowered-priced models.
And the election of former President Donald Trump this November would mean that the $7,500 tax credit is on the chopping block.
The future of the electric vehicle industry is filled with uncertainty after they were touted as the automobile of the future.
