In the next months, Lucid, the EV company behind the Air car that competes with the Tesla Model S, will lay off around 1,300 people, or 18 percent of its staff. According to an email from CEO Peter Rawlinson that was attached to a regulatory filing, the layoffs will touch “almost every organization and level, including executives.”
Rawlinson adds that staff will learn more about the layoffs over the following three days, and the filing indicates that the reorganization will be completed “by the end of the second quarter of 2023.” The email states that terminated employees will receive “career resources, continuation of Lucid-paid healthcare coverage, and acceleration of equity,” and the filing states that the company expects to spend between $24 million and $30 million on “charges related to employee transition, severance payments, employee benefits, and stock-based compensation.”
Those who have been following Lucid will not necessarily be surprised by this.
Rawlinson explains that the layoffs “match with the cost discipline statement we made in late February when we reported profits,” when the company also said that it had burned through around $2.6 billion over the course of the fiscal year 2022.
In February, the business announced that it had over 28,000 bookings, but that it would only be able to construct between 10,000 and 14,000 vehicles during 2023. Even that would be a significant increase, given that the company produced 7,180 vehicles in 2022 and delivered around 4,300.
Last week, the company recalled 600 vehicles to fix a power-loss issue.
Lucid is not the only carmaker making significant cost reductions. In the last year, Ford has let off around 3,000 employees, GM has given buyouts to a large number of its employees as part of a $2 billion budget-cutting strategy, Stellantis has revealed intentions to close a facility, and Tesla has carried out a round of layoffs. Other startups have also encountered difficulties. Arrival lay off fifty percent of its personnel, and Rivian reduced its employment by six percent twice.