Peter Rawlinson, CEO of Lucid Motors, wants everyone to calm down (or at least stop panicking for five minutes). Last Thursday, Lucid’s stock took its worst nosedive in almost three years after they announced a $1.75 billion public offering. Wall Street analysts and investors? Not exactly thrilled. But Rawlinson says it’s all just a misunderstanding.

In an interview that could be summed up as “Chill, we’ve got this,” Rawlinson explained that the capital raise was a planned move to keep the company financially stable through 2026. “We signaled that we had a cash runway until Q4 next year,” he pointed out, as if everyone should’ve been expecting this. Well, long story short, they weren’t.

So, why did Wall Street lose its mind? Timing. Investors are scratching their heads, wondering why Lucid needs more cash when they just secured $1.5 billion from Saudi Arabia’s Public Investment Fund (PIF) a couple of months ago. Add to that Lucid’s existing $5.16 billion liquidity stash, and the whole situation feels a little like a rich guy asking to borrow $20 for gas money. (Little sus huh?)

Lucid’s stock plummeted 18% after the announcement, Morgan Stanley analyst Adam Jonas said the raise was “slightly larger and earlier than we had expected.” Rawlinson, however, isn’t phased. He doubled down, saying this capital raise is all part of the master plan to grow the business, expand their Arizona factory, build another plant in Saudi Arabia, and roll out their new SUV, the Gravity. And let’s be honest—building the future of electric vehicles isn’t exactly cheap. You’ve got R&D costs, a service network to expand, and apparently, all the suppliers to keep happy.

Rawlinson isn’t just defending the capital raise. He’s also taking aim at plug-in electric hybrids (PHEVs), calling them “the worst of everything” and saying they come with “all the costs of two systems.” In other words, hybrids are like trying to cook two meals at once but ending up with cold pasta and burnt toast. Lucid, on the other hand, is committed to full-on electric vehicles, and Rawlinson wants you to know it.

If you think Lucid’s troubles are concerning, Rivian will make you feel better. Sure, Rivian once had all the hype, with its sleek electric trucks and SUVs, but the reality of building EVs at scale is starting to catch up to them. Rivian’s production numbers, while improving, are still far from impressive. For context, they delivered 15,564 vehicles in Q3 2024 (an improvement over previous quarters but still a drop in the bucket compared to what the big players, like Tesla, are putting out). Tesla, by the way, cranked out over 430,000 cars in Q3 alone, leaving Rivian in its dust.

The real problem for Rivian? Cash burn. The company posted a $1.2 billion net loss in Q2 2024. Despite raising $1.3 billion in convertible green bonds this year, Rivian's still burning through cash faster than they can raise it. Even their much-anticipated R1S and R1T trucks aren’t selling fast enough to close the financial gap.

Supply chain issues? Check. Rivian has been struggling to keep up with parts and production, which has delayed deliveries and left customers wondering when they'll actually get their hands on their new trucks. Add to that the fact that Rivian’s average vehicle price is north of $70,000, and suddenly it’s clear why their market is limited.

While both Rivian and Lucid are battling their own demons, it’s interesting to note that Rivian, despite delivering more vehicles, is burning cash at a much faster rate. Lucid, on the other hand, is focused on ensuring its cash lasts longer, with this $1.75 billion raise giving them a runway into 2026.

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