Lucid to cut 18% of workforce in cost-saving move

Lucid is planning to lay off around 18% of its workforce in an attempt to cut costs as the automaker continues to bleed cash during its production ramp. The company informed employees of the layoffs during an all-hands meeting on Tuesday, where CEO Peter Rawlinson said the cuts would impact every organization and level of the company, including executives.

According to several sources who spoke with Insider, a memo was sent out shortly after the meeting detailing the plans for the layoffs, which are estimated to impact around 1,290 employees worldwide. Over the next three days impacted employees will be laid off and offered a severance package, which will include “access to career resources, healthcare coverage continuation, and acceleration of equity,” according to the memo reviewed by Insider.

The memo stated that the staff reductions were a “painful but necessary decision,” as the company’s objectives couldn’t be met through cost optimization efforts alone.

The layoffs mark yet another bump in the road for the struggling EV startup. Last year Lucid produced 7,180 vehicles, exceeding their guidance of between 6,000-7,000 vehicles, but delivered just 4,369 of those to customers. Both of those numbers are far off what the company was originally hoping to achieve in 2022.

When it started out the year it was guiding for about 20,000 new Air sedans being built at their manufacturing facility in Casa Grande, Arizona, but that number was slashed several times during the year. Their facility has a capacity to build 34,000 cars per year.

While they have been struggling to produce and deliver cars, those that have been built have suffered from problems. Earlier this week nearly 700 Air sedans were recalled because the electric motors might shut down while driving.

At the same time, the automaker has seen a large number of reservation holders cancelling their orders.

Elon Musk sounds another warning bell for Lucid – “They are not long for this world”

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