Lucid expands plant for 2025 Gravity crossover as demand wanes for Air sedan

Lucid Motors has expanded its Casa Grande, Ariz., factory by about 3 million square feet in preparation for the launch of the Gravity crossover, which the EV maker expects to sell better than its Air sedan.

The project brings the automaker's enlarged AMP-1 plant to about 3.85 million square feet, more than four times its previous size, Lucid said in a press release.

"The expansion of our manufacturing footprint in Arizona is a significant milestone for the company, as we prepare for the next phase of Lucid's growth," CEO Peter Rawlinson said last week.

Changes to the factory will bring greater operational efficiency and cost savings, Lucid said. It did not say what annual production capacity will be following the expansion.

In addition to preparing the 2025 Gravity, which Lucid said will launch "in the near future," Rawlinson has said the company is working on a midsize platform for more affordable vehicles to arrive later in the decade.

Lucid said in November that the Gravity will enter production in late 2024. Both the Air and Gravity are large vehicles.

The Air starts at $78,600 including shipping, and the top Sapphire variant is $250,500 with shipping. Lucid said in a November presentation that it expects the Gravity to start at around $80,000 before shipping charges, which it has not announced.

On an earnings call, also in November, Rawlinson said the Gravity "will significantly expand our market opportunity, opening up a total addressable market that is nearly three times larger and growing."

The Arizona plant expansion comes after Lucid marked two years of manufacturing the Air sedan. Since the start of production in late 2021, Lucid has delivered just over 10,000 Airs to customers, according to its financial statements.

Lucid said it suffered manufacturing issues in 2022, including parts shortages, that hampered production. At the start of 2023, Rawlinson said the automaker's top challenge had shifted from a lack of supply to softening demand for its product.

The automaker has repeatedly cut its production guidance for the Air.

In Lucid's investor presentation in July 2021, Lucid forecast it would produce 20,000 Airs in 2022 and 49,000 vehicles in 2023, including the Air and Gravity. Last year's production was 8,428 for the sedan, Lucid said.

According to November data, the most recent month available, Air registrations fell 14 percent from the year-earlier month to 425 vehicles, S&P Global said. Lucid's share of the U.S. EV segment fell to 0.5 percent from 0.7 percent a year earlier.

Air registrations trailed sedan rivals such as the Tesla Model S, which had 1,499 in November, and the Porsche Taycan with 436 for the month, S&P Global said.

Lucid said it delivered 1,734 Airs in the fourth quarter, down 10 percent from fourth-quarter 2022.

Lucid's stock price was down 71 percent over the past 12 months, as of Monday's market close. Since the start of the year, its stock price was down about 19 percent.