Lucid Motors has denied reports that it is considering filing for Chapter 11 bankruptcy protection.
“The rumors are completely false,” Nick Twork, the company’s chief communications officer, said in a statement to TechCrunch.
“As announced in our most recent quarterly report, the company has sufficient liquidity to continue operations into next year and has not established a special board committee to explore the scenario reported today,” he said. “Our focus is to improve execution, strengthen operations and enable Lucid to realize the full potential of its technology, products and innovations.”
According to Bloomberg News, Lucid’s denial comes after its stock price plunged more than 50% on Tuesday, the largest intraday drop. The stock has recovered from its freefall and is trading at $4.72 per share as of 2:46 PM ET, about 14% below its opening price.
The company recently appointed a new CEO and laid off more than 2,000 employees this year as part of a major restructuring ahead of the launch of a smaller, more affordable electric SUV later this year.
On Tuesday morning, Electric Car Blog published a report citing two unnamed sources saying the company is considering filing for Chapter 11 bankruptcy protection or going private, following a recommendation from consulting firm AlixPartners. Twork said AlixPartners is helping Lucid strengthen its operations and “is not supporting anything else and has not recommended bankruptcy to management or the board.”
Alix Partners has recently established itself as a consulting firm for electric vehicle companies that are experiencing difficulties.
Lordstown Motors acquired the company in 2021 to reorganize its nascent business following the resignation of its CEO and CFO. The startup ultimately partnered with Taiwanese electronics giant Foxconn, but the relationship soured and Lordstown Motors went out of business.
Faraday Future has also brought in AlixPartners to help implement recommendations made by its board following its 2022 internal investigation.
Lucid Motors recently announced that it delivered 3,953 vehicles in the second quarter of this year, which is slightly more than the same period last year. Despite their impressive technical specifications, luxury EVs have historically had a hard time finding buyers. With the latest round of layoffs announced earlier this month, Lucid said it would eliminate a second production shift at its Arizona plant to “align production plans with anticipated demand.”
Lucid Motors is also working with partners Uber and Nuro to launch a luxury robotaxi service by the end of the year. Uber has committed to purchasing at least 35,000 Nuro-equipped Lucid Motors vehicles for its efforts over the next few years, 10,000 of which will be Gravity SUVs and 25,000 based on the upcoming midsize EV platform.
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