September 20, 2021
Lucid Motors goes public, raising $4.5 billion in the process

Lucid Motors goes public, raising $4.5 billion in the process

Lucid Motors, an electric vehicle startup, has become a publicly traded business after completing a transaction that netted them $4.5 billion in fresh funding. On Monday morning, shares in the Saudi-owned, California-based business started trading on the Nasdaq stock exchange.
Lucid Motors will now devote its whole attention to an even more difficult task: putting its first electric vehicle on the roadway, where it will face fierce competition from Mercedes-Benz, Tesla, and others in the premium sector. The company has stated that it aims to begin shipping its tremendously powerful but serenely luxury Air sedan later this year. It has already produced over 100 close-final quality models at its manufacturing plant in Arizona. It’s also working on an electric SUV named Gravity.
The public offering is the industry’s second in the last week; fellow EV firm Faraday Future went public on Nasdaq last Thursday, raising $1 billion in the process. The two firms are the latest in a long series of electric car startups, autonomous vehicle firms, and automotive vendors to go public by combining with SPACs, or publicly traded investment vehicles.
On the other hand, Lucid Motors has been around for quite a while, unlike many of the other companies. It began as a battery startup called Atieva in 2007. But in 2016, it decided to construct its all-electric car, appointing Peter Rawlinson, the former senior engineer of Tesla’s Model S program, to spearhead the charge. (Rawlinson would go on to become the company’s CEO.)
Lucid Motors had anticipated to begin production on the Air as soon as 2018. However, it ran into the same issue that nearly terminated the journey for several of its peers: a lack of funds. The company had raised millions of dollars to that time, but it required billions, partly because it was also attempting to create a plant to produce the vehicle.
In 2016 and 2017, however, funding for electric vehicle companies became much more challenging to come by, especially as some of them, like Faraday Future, began collapsing in a highly public manner. Even worse for Lucid Motors was the revelation that Jia Yueting, Faraday Future founder, ended up holding 30% of his competitor’s stock. According to Recode and The Verge, Jia’s ownership has become a huge issue for possible investors due to his unwillingness to sell. After talks with financiers and even automakers like Ford fell through, Lucid Motors had to rely on loans from the hedge financing and a Chinese bus operator to keep the lights on, with its intellectual property serving as collateral.

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