Lucid rejects take-private, bankruptcy report after shares plunge
Lucid Denies Bankruptcy and Take-Private Rumors Amid Stock Volatility
Company Response to Rumors
July 14 (Reuters) - Lucid Group on Tuesday denied as "completely false" a blog post saying it was considering a potential take-private transaction or a Chapter 11 bankruptcy filing, after the electric-vehicle maker's shares tumbled more than 50% in what would be their steepest one-day decline.
Lucid said it had sufficient liquidity to fund operations well into the next year, and had not formed a special board committee to explore the reported scenarios. It also said restructuring adviser AlixPartners was assisting the company on improving execution and operations, and was not recommending bankruptcy.
Details of the Blog Report
The Eletric-Vehicles blog reported that AlixPartners had been asked to present its findings to Lucid's board before its next meeting and that scenarios under review included taking the company private or seeking Chapter 11 bankruptcy protection, while adding that no decision had been made.
Stock Market Reaction
Trading in the stock was halted multiple times after 1 p.m. ET because of volatility. The stock fell as much as 57% to $2.37 in afternoon trading before paring losses.
Shares were last down about 13% at 2:45 p.m. ET.
AlixPartners did not immediately respond to a Reuters request for comment.
Lucid's Financial and Operational Challenges
Lucid's shares have lost about 99% of their value since the company went public, as it has struggled to turn a profit nearly five years after its market debut.
Ongoing Restructuring Efforts
The report comes as Lucid undergoes a broad restructuring under CEO Silvio Napoli, who took over in June.
Workforce Reductions and Leadership Changes
Last month, the company said it would cut about 18% of its U.S. workforce, eliminate the chief operating officer role and streamline its leadership structure to reduce costs and improve execution.
Lucid also announced a series of executive appointments, including naming Alexander De Bock as chief financial officer and appointing new leaders for technology, customer, transformation and digital functions.
Production and Guidance Updates
In May, Lucid suspended its 2026 vehicle production forecast of 25,000 to 27,000 vehicles after supplier-related issues disrupted deliveries of its Gravity SUV, saying it would provide an updated guidance following a strategic review under Napoli.
Investor Concerns and Future Outlook
Despite billions of dollars in backing from Saudi Arabia's Public Investment Fund, Lucid has struggled with weak demand, persistent cash burn and repeated capital raises, prompting investors to question how quickly it can scale production and move toward profitability.
(Reporting by Akash Sriram in Bengaluru' Editing by Tasim Zahid)
