Remember back in the day when Lucid Group was hyped up to be the next big thing in electric vehicles? 

Yeah, they were supposed to give Tesla a run for its money with their sleek, luxury Air sedan that promised a 520-mile range (longer than anything Tesla had at the time) and a starting price tag north of $100,000. 

They were targeting the high-end market, aiming to be the "Mercedes of EVs," and investors were all in, thinking they had finally found Tesla’s real competition. But fast forward to today, and that shining star is burning out faster than your phone battery on 1%.

Lucid’s stock is already down 17% this morning, and it's not because they’re rolling out a new model that can fly you to Mars (Elon’s got dibs on that). It’s because they’re hemorrhaging cash faster than a TikTok influencer at a Gucci sale and warning investors of massive losses ahead.

Lucid’s stock plummeted after the company announced it’s hitting the panic button (selling 262.5 million shares to the public to "shore up finances"). That’s corporate-speak for "we need money, like, yesterday." And just when you thought the damage couldn’t get worse, they’re offering another 375 million shares to their sugar daddy, Saudi Arabia’s Public Investment Fund (PIF).

(Source: Drive Tesla Canada)

But of course, the Saudi deal only goes through if Lucid can successfully pull off the public stock sale. So, the real question is, will Wall Street take the bait?

Lucid actually reported some record-breaking delivery numbers for Q2, but it seems that wasn’t enough to keep investors bought in. The company secured $1.5 billion from Saudi-backed Ayar Third Investment Co. earlier this year, but apparently, that cash is evaporating faster than a snowman in the desert.

Despite all this, Lucid is struggling. Their Air sedan? Well, it’s selling about as well as my wife’s shower rods listed on Facebook Marketplace. Demand for EVs is slower than expected, and Lucid’s marketing game is… let’s just say, lacking. They’re competing against Tesla, and it feels like they’re trying to run a marathon with concrete boots.

Now, why would a company that’s already seen its stock dip 22% this year decide to flood the market with more shares? Great question. It seems like a last-ditch effort to raise capital for "general corporate purposes" (which in corporate lingo could mean anything from paying their electric bill to funding that long-promised new model that’s still nowhere to be seen).

In addition to the public offering, Bank of America Securities is the sole underwriter here, with an option to gobble up 39.37 million extra shares. So, yeah, more shares, more problems.

Lucid’s warning of a third-quarter loss that’ll range between $765 million and $790 million while Wall Street was hoping for something more in the ballpark of $752 million. Meanwhile, they’re burning through cash fast. Their total cash and equivalents are sitting at around $1.9 billion, which, in EV terms, isn’t enough to cover a long weekend in the development cycle.

(Source: Electrek)

The glass half full outlook? Saudi Arabia’s Public Investment Fund still holds about 58.8% of Lucid’s stock. They’re sticking by their prized asset (for now). But even with the deep pockets of Saudi royalty, Lucid’s future is looking about as bright as their other investment (LIV Golf). And let’s not forget, Lucid still has to report their quarterly results on November 7.

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Stock.News has positions in Tesla and Meta.