Delivery of 360 Lucid Airs in Q1 is an improvement

California electric vehicle startup Lucid Group delivered just 360 units of its pricey Air sedan in the first quarter of the year, as supply chain woes continued to constrain production at its Arizona factory.

First-quarter production was a modest 700 vehicles, the company said, or about eight vehicles a day.

Nonetheless, Lucid announced last week during its first-quarter earnings report that it's raising prices starting in June, although current reservation holders and May orders will still get the lower pricing.

There is something of a silver lining to Lucid's struggles. First-quarter deliveries were an improvement over the previous quarter, and April deliveries marked further gains, CEO Peter Rawlinson said.

"In Q1, we delivered 360 vehicles to customers, nearly tripling the 125 cars delivered in Q4 of 2021," Rawlinson said on the earnings call. "In April alone, we delivered well over 300 vehicles, demonstrating our accelerated production ramp."

Rawlinson reiterated the automaker's previous production guidance of 12,000 to 14,000 Air sedans this year. That's significant because Lucid had reduced its earlier guidance of 20,000 as part of its earnings report in February.

Rawlinson also said last week that demand continues to be strong, with more than 30,000 reservations for different trims of the Air, including a healthy mix of the most expensive ones.

Lucid last month added a top-tier Grand Touring Performance trim that will start at $180,650, including shipping. The previous top trim was the limited-run Air Dream Edition that sold out at 520 vehicles.

CFO Sherry House said the price hikes for other trims are coming in anticipation of increased parts and shipping costs, as well as some higher costs for the next phase of factory construction.

The price increases are effective June 1, leaving a small window for new reservations to lock in at current prices.

After this month, new reservations in the U.S. will start at $155,650 for the regular version of the Air Grand Touring, including shipping. That's up from $140,500.

Lucid said it's on track to produce more inexpensive trims later in the year. The Air Touring will start at $109,050, up from $96,500 currently. The base Air Pure will start at $89,050, up from its current price of $78,900, the company said.

"Similar to many companies in our industry, we continue to face global supply chain and logistics challenges, including COVID-related factory shutdowns in China," House said.

In first-quarter financial results, Lucid posted a $598 million operating loss on revenue of $57.6 million. House said the automaker's $5.4 billion cash on hand would allow it to execute its expansion plans into 2023 as it rolls out more inexpensive versions of the Air and plans for the 2024 launch of the Gravity utility vehicle, the automaker's second nameplate.

Lucid's Phoenix-area plant has capacity to build 34,000 vehicles a year and is expanding to 90,000 a year by late 2023, the company said. By mid-decade, House said, capacity will rise to 350,000 in Arizona and 150,000 at a new plant in Saudi Arabia, which is a Lucid financial backer.

By respecting current prices for its vehicles, Lucid is avoiding the uproar caused at another popular California EV startup this year. Rivian Automotive attempted to raise prices on its reservation holders, a move that resulted in massive blowback.

In response, Rivian CEO RJ Scaringe apologized to buyers of the R1T pickup and R1S SUV for betraying their trust and backtracked on the price increases for vehicles booked before March 1.

Rivian's price hikes of about 20 percent were higher than Lucid's, but Rivian also created more inexpensive models at the older price points. Rivian's base R1T starts at $68,575, including shipping.

Both Lucid and Rivian have received widespread industry praise for their high-end EVs, along with order backlogs that will stretch into next year and beyond.

Rivian said it has continued to log new orders even at the higher prices.

Reuters contributed to this report.