EV maker Lucid plans to raise $8bn through new offerings to boost capital
Electric vehicle manufacturers globally are struggling to control costs amid supply chain disruptions and shortages of parts and raw materials
Lucid Group, which counts Saudi Arabia's sovereign wealth fund, the Public Investment Fund, among its backers, plans to raise $8 billion through new offerings as the luxury electric vehicle maker looks to boost production.
Lucid aims to raise funds from mixed offerings and sell different types of securities “from time to time” with the size, price and terms to be determined at the time of sale, it said in a primary prospectus filed with the Securities and Exchange Commission in the US.
Lucid offerings may include selling “common stock, preferred stock, depository shares representing preferred stock, debt securities, warrants, purchase contracts or units in one or more offerings of up to $8bn in aggregate offering price”, the company said.
In addition, Lucid may issue up to 44.35 million common stocks, it said.
The company wants to boost its working capital amid supply constraints that have increased costs and crimped production.
EV manufacturers in recent quarters have struggled to control costs amid global supply disruption and shortages of parts and raw materials.
Manufacturers including Tesla have been burning cash in a bid to boost production. Tesla chief executive Elon Musk in June said the company’s plants in Germany and Texas were losing “billions of dollars”.
Earlier this month, Lucid halved its production forecast, citing extraordinary supply chain and logistics challenges. The company, which has a market value of about $27bn, now expects to produce between 6,000 and 7,000 luxury Lucid Air EVs this year, down from the 12,000 to 14,000 units targeted in February.
In May, Lucid signed a formal agreement with Saudi Arabian entities including the Ministry of Investment of Saudi Arabia, the Saudi Industrial Development Fund (SIDF), the Economic City at King Abdullah Economic City and Gulf International Bank to set up a factory in the kingdom.
The agreements are expected to provide financing and incentives worth $3.4bn to Lucid over the next 15 years, to build and operate the manufacturing centre that is expected to produce 155,000 units a year.
The production line would boost Lucid’s global production capacity to 500,000 EVs per year in the coming years, the company said at the time.
In April, Lucid also signed an agreement with Saudi government for the sale of 100,000 cars that will support Riyadh's sustainability drive.
The deal with the kingdom's Ministry of Finance — which will include the flagship Lucid Air and other future models — covers a 10-year period and includes an initial commitment to purchase 50,000 vehicles, plus an option for up to 50,000 additional cars over the same period.
Source: The National