Lucid Stock experienced a decline in trading on Monday, May 5. The electric vehicle company's shares dropped several percentage points during the day. The movement occurred despite a recent announcement detailing a partnership aimed at advancing EV technology.
Concerns over potential import tariffs and the long-term implications of the company's relationship with Saudi Arabia appeared to weigh on investor sentiment. The market also anticipated the company's first-quarter earnings report scheduled for release on Tuesday.
Earlier, Lucid Group, Inc., announced a strategic partnership with King Abdullah University of Science and Technology (KAUST) in Saudi Arabia. The collaboration focuses on advancing EV technology leadership, autonomous driving systems, and advanced driver-assist capabilities.
The partnership grants Lucid access to KAUST's supercomputing resources. This access is intended to enhance the company's research and development efforts in areas like materials science, simulation for safety and optimization, thermal transfer analysis, and AI training for autonomous systems.
Saudi Arabia's Public Investment Fund (PIF) holds a majority stake in Lucid and serves as a primary source of financing. This relationship is under scrutiny following recent actions by the Donald Trump administration.
Over the weekend, the administration announced a 100% tariff on certain foreign goods. While previous tariffs focused on physical products, this announcement has raised questions about potential import taxes on non-physical items or foreign-originated designs, which could impact Lucid's operations or structure given its ties to Saudi Arabia.
Lucid provided a business update in early April stating it produced 2,212 vehicles in the first quarter. The company also noted it sent an additional 600 vehicles to Saudi Arabia for final assembly. Lucid delivered 3,109 vehicles during the period.
The Q1 earnings report is expected to show another net loss for the company, similar to the loss reported in the fourth quarter of last year. Investors will monitor the report for details on forward targets and any guidance provided regarding the potential impact of tariffs. The company trades under the ticker LCID.
"Access to high-performance computing at this level is truly transformative," said Eric Bach, SVP of Product and Chief Engineer at Lucid, regarding the KAUST partnership. "It dramatically enhances our ability to develop advanced fluids, materials and alloys, simulate real-world physics for crash safety and structural optimization, model fluid dynamics and thermal transfer, analyze electromagnetic flux, and accelerate AI training for digital twin technology, autonomous systems, and large language models. We’re deeply grateful for this opportunity and excited about the breakthroughs it will drive across our engineering and AI initiatives.”
