Lucid Group (LCID) is an EV manufacturer with a focus on luxury that set a record for the most deliveries in a single year, meeting expectations. Lucid Group is also expanding its lineup to include more affordable options to compete with rival Tesla (TSLA).
At the current valuation, there is a lot of potential but this niche automaker has a lot of work to do to beat Elon Musk’s juggernaut. Is Lucid Group stock a millionaire maker?
What Does Lucid Group Have Going for It?
Lucid seems poised for a better year in 2025 versus 2024 by scaling production of its second electric vehicle model. The manufacturer set a benchmark in 2024 by delivering 10,241 vehicles, a record and a 71% jump year-over-year.
Management said it plans to produce 20,000 vehicles in 2025, more than double the 9,029 it produced in 2024. The Lucid Gravity, its second offering, began production late last year. It joins the Lucid Air, a luxury sedan, in its lineup.
Look at what happened to sales of the Porsche Taycan, a comparable model, when the well-known luxury automaker sold just 20,836 of its EV models in 2024, a drop of 49%. Lucid can take advantage of Porsche’s sales decline thanks to its domestic production versus an import model.
The bigger news revolves around Lucid’s plans to build three affordable EVs to compete with Tesla’s lineup thanks to Lucid’s mid-size SUV, a sedan, and an off-road SUV. The details of those three models have yet to be released, but they should start production in late 2026.
The EV market in the United States kept climbing last year. People bought 1.3 million EVs that year, up 7.3% from 2023. The segment was bolstered by new offerings from General Motors (GM) and Honda (HMC), as well as higher sales from Hyundai (HYMTF) and Ford (F).
Lucid ended Q4 2024 with $6.13 billion in cash reserves. So, it can convert assets to liquidity quickly if needed. That’s a good sign for investors worried about this relatively new automaker shutting down.
All of these factors paint a bright future for Lucid Group though the automaker faces several challenges as it seeks to gain more market share against other automakers.
What Challenges Does Lucid Group Face?
EV infrastructure to scale production is the main challenge Lucid Group faces. Tesla delivered 1.8 million EVs last year, much more than Lucid. Larger automakers that have shifted some capital to EVs have huge investments in those product lines. Think Ford, GM, Honda, and others.
Lucid is following Tesla’s strategy of launching luxury EVs first, then introducing affordable models after the luxury vehicles increased company revenue. The Tesla business model plays out in other technology sectors, too. Personal computers and cellphones were once only attainable by wealthy people and businesses. Now, those are everywhere.
Will Lucid EVs rival Tesla’s? Lucid sold $800 million worth of its Lucid Air sedans in 2024. With Lucid Gravity entering the market, analysts predict sales will grow by 82% in 2025 and 91% in 2026. Can this automaker improve sales by 200% or higher in the next two years? At the end of that cycle, Lucid plans to roll out its more affordable SUVs that should help drive sales higher.
Rivian (RIVN) is another EV manufacturer that stands to gain a lot in the coming years having produced 50,000 EV trucks last year, five times the output of Lucid. Rivian plans to make another 50,000 models in 2025.
Costs of Manufacturing Lucid EVs
Another headwind for Lucid is its manufacturing costs. The high costs of making EVs led to a loss of $3.1 billion in 2024 but manufacturing costs dropped year-over-year.
The automaker spent $1.9 billion to produce 8,400 EVs in 2023. A year later, those costs dropped to $1.7 billion to make 9,000 vehicles. So, the gross margin aims to improve in 2025 with the introduction of a second model, allowing Lucid to spread its manufacturing costs among a larger number of vehicles.
One thing to consider is that Tesla had 17 straight years of unprofitable results before turning a full-year profit for the first time in 2020. If someone invested $5,000 in Tesla stock in 2010, that number would exceed $1 million in 2025. So, putting money toward a low-priced EV company right now has historical precedents.
Future Electric Vehicle Sales Amid a Leadership Transition
Sales expectations for Lucid remain high. But can they attain them? Last year, Lucid issued additional shares to its largest shareholder, the sovereign wealth fund of the Saudi Arabian government. This diluted the holdings of other investors. When this happened, the share price fell 20%. Yes, the extra investment from the Saudis helped. But Lucid must come through with more EV sales to generate revenue.
The company’s CEO, Peter Rawlinson, stepped down in February 2025 to take on a technical advisor role on the board of directors. Rawlinson was the former chief engineer for Tesla. COO Marc Winterhoff is serving as an interim CEO. Rawlinson served as Lucid’s CEO for 12 years. He felt like it was time to step aside now that the additional vehicle lines are ready to move forward.
Can Lucid meet its sales expectations in 2025 and 2026? At 10,000 units, the Lucid Air ranked 31 out of 63 models sold in the United States in 2024. It beat out models from Genesis, Jeep, Volvo, Jaguar, Porsche, and Mercedes, among others.
Before its IPO, Lucid claimed it would deliver 20,000 vehicles in 2022. That target is more realistic now in 2025. But the leadership team overpromised and underdelivered in the past. Will this happen again?
It will be up to Winterhoff, a first-time interim CEO, to oversee the company’s production until the board appoints a new CEO. Time will tell if deliveries of Lucid vehicles can turn the stock into a millionaire maker.
Should You Invest in Lucid Group Stock as a Potential Millionaire Maker?
Lucid Group has the potential to turn investors into millionaires, so long as the company overcomes its main challenges and turns toward profitability. It must meet sales targets moving forward.
Currently, the market cap stands at $7.7 billion with a stock price of under $3. Earnings per share have been negative in the past year. So, Lucid isn’t necessarily a gleaming gem among automotive or tech stocks. With Tesla’s stock surge now that Chinese tariffs have eased, it may be harder for Lucid to compete with the established EV manufacturer.
Despite its challenges, investors in Lucid stock may have a wait-and-see approach. One year of doubling production will not make Lucid profitable. Automakers have a decade-long approach to making money. Just look at Ford stock prices, which are around $10.56. Back in May of 2020, Ford was at $4.90 a share, and it’s been selling vehicles for more than 120 years.
Analysts have a consensus rating of Hold, with 11 hold ratings out of 13 total ratings. Analysts’ consensus price target is $2.53.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.
