Lucid is elevating USD 1 billion in capital from an affiliate of Saudi Arabia’s Public Funding Fund (PIF), it stated on Monday, sending the shares of the posh electrical carmaker up practically 20%.
The most recent funding by the sovereign wealth fund underscores a key benefit Lucid has within the race for survival amongst struggling EV startups.
The Saudi authorities, which has a 60% stake, has invested billions in Lucid’s success as a part of a technique to diversify the Kingdom’s economic system past oil.
Ayar Third Funding Firm, a PIF affiliate, will purchase USD 1 billion in convertible most popular inventory and can have the ability to convert the popular inventory into about 280 million shares, based on a regulatory submitting with the U.S. securities regulator.
The California-based firm, which has been going through weaker-than-expected demand, stated it intends to make use of the proceeds for company functions and capital expenditure amongst different issues.
Lucid is one among a number of EV startups hit exhausting by the slowdown in demand progress and a worth battle sparked by Tesla.
Lucid, headed by a former Tesla government, expects to make 9,000 items in 2024, in contrast with the 8,428 autos it made final yr.
Lucid’s Air luxurious sedans compete with Tesla’s Mannequin S and luxurious EVs from Mercedes-Benz, BMW, Audi and Porsche, amongst different manufacturers.
Lucid had final month stated in its fourth-quarter monetary presentation that it had adequate liquidity “no less than till 2025” and forecast USD 1.5 billion in capital spending in 2024 because it pushes to launch its Gravity SUV line later this yr.
The corporate had USD 4.8 billion in obtainable funds on the finish of 2023, together with USD 4.3 billion in money.
