One luxury electric vehicle manufacturer is laying off workers after overestimating demand for its products.
Bay Area-based electric vehicle startup Lucid Group announced that it was laying off 1,300 workers in a Tuesday filing, according to SFGATE.
Lucid CEO and CTO Peter Rawlinson indicated that the firings would affect every level of the company in a letter to employees.
“Our U.S. workforce will see reductions in nearly every organization and level, including executives.”
Rawlinson said that Lucid would terminate 18 percent of its total workforce, or 1,300 employees.
BREAKING: Lucid is planning to lay off about 18% of its workforce.
Lucid, which had about 7,200 employees at the end of last year, will communicate details of the layoffs in the next few days.https://t.co/lO1VTAQlc1
— Sawyer Merritt (@SawyerMerritt) March 28, 2023
Rawlinson promised career assistance for those separated from the company in a company email.
“We are offering impacted employees a severance package that includes access to career resources, Lucid-paid healthcare coverage continuation, and acceleration of equity to help as much as possible with the transition.”
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Rawlinson pledged to implement new cost-reduction strategies in another message to employees.
$LCID A Message from our CEO, Peter Rawlinson. https://t.co/I6jDS9bxbP pic.twitter.com/XxjSKud718
— Jhin_f(x)Invest (@fxinvestw) March 29, 2023
Lucid offers vehicles at a range of retail prices between $87,400 to $249,000, according to SFGATE.
Low demand for the carmaker’s products preceded the layoffs.
Other electric vehicle companies — such as Lucid competitor Rivan — have also resorted to scaling back their workforces amid a weak market for the luxury products.
Lucid has also struggled with producing its vehicles. The company plans on completing 10,000 to 14,000 vehicles in 2023, less than the reservations currently lined up for the products.
By comparison, Tesla produced more than 1.3 million cars in 2022, according to Statista.
The company has received extensive early investment from Saudi Arabia’s sovereign wealth fund.
The entity fueled Lucid with $915 million in cash in December.
Other enterprises involved in making electric vehicles have struggled to turn a profit.
Ford admitted that its electric vehicle unit was losing billions of dollars a year, and predicted the entity wouldn’t be profitable until 2026.
