Stock Track | Lucid Group Soars 5.16% as Investors Bet on Its Long-Term EV Prospects Despite Near-Term Challenges

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Lucid Group Inc. (LCID) shares surged 5.16% in pre-market trading on Tuesday, as investors remained optimistic about the electric vehicle (EV) maker's long-term prospects despite its current challenges in ramping up production and widening losses.

The company recently reported disappointing third-quarter results, with losses increasing to $992 million, compared to $631 million in the prior-year quarter. Vehicle production also fell on a sequential basis, with Lucid producing just 1,805 vehicles in Q3, down from 2,110 in Q2. However, the company estimates its total production for 2024 will be 9,000 vehicles, up less than 7% from 2023.

To shore up its financial position, Lucid sold nearly 263 million shares of new common stock and tapped its largest investor, Saudi Arabia's Public Investment Fund, for additional cash, raising a total of $1.67 billion. While this move provides Lucid with enough cash to keep its operations running until 2026, it also dilutes existing shareholders' stakes and raises concerns about the company's ability to achieve profitability in the near term.

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