Lucid's stock plummeted amid a restructuring and delays in the launch of its budget model

Shares of electric vehicle manufacturer Lucid Group plummeted by more than 8% in the first few minutes of morning trading on August 5. The company is postponing the launch of its budget model amid a business reorganization and cost-cutting efforts, CEO Silvio Napoli said.

Lucid shares fell by more than 8% in the first few minutes of premarket trading on August 5. The day before, the company announced a reorganization aimed at improving efficiency, reducing cash outflow, and enhancing customer service.

This is the plan of Lucid’s new CEO, Silvio Napoli, who was appointed to the position in April 2026, according to Bloomberg. It consists of four points. The first calls for savings of approximately $1.4 billion in 2026. According to the press release, the company will save about $500 million by reducing capital expenditures, $600 million to $800 million by reducing inventory, and approximately $200 million by cutting operating expenses.

The other three items outline Lucid’s priority projects. These include the development of the robotaxi program, which the electric vehicle manufacturer is implementing in partnership with Uber and software developer Nuro, as well as preparations for the launch of a plant in Saudi Arabia and continued work on a midsize electric vehicle.

Meanwhile, the launch of the budget model, originally scheduled for the end of this year, has been postponed to the second half of 2027, Reuters reports, citing Napoli.

“Our approach to work needs to change. While there is no doubt that Lucid has brought cutting-edge innovations and outstanding products to market, we have fallen short in several areas,” said the company’s CEO, Silvio Napoli, during a conference call with analysts on August 4 (as quoted by Bloomberg). The launch of the luxury Air sedans and Gravity SUVs was carried out “a little too hastily,” Napoli told Reuters. “My goal is to launch a midsize car when the project is ready. Rushing to do so before everything is finalized would, in my view, be a terrible mistake,” he said.

Napoli also said that Lucid's annual production and delivery volume of electric vehicles will fall short of current Wall Street forecasts, according to Bloomberg.

In addition, the company faced high costs, supply chain issues, and sluggish consumer demand in the U.S., as the administration of U.S. President Donald Trump imposed tariffs and scaled back policies supporting electric vehicles, Bloomberg reports. For example, in the first quarter of 2026, due to a problem with a seat supplier, the company was forced to suspend deliveries of the Lucid Gravity SUV for 29 days. As a result, it increased production by 149% year-over-year for the quarter, but deliveries to customers remained at the same level.

But the main problem is the company's losses, according to The Motley Fool. In the first quarter of 2026, the net loss exceeded $1 billion on revenue of $282.5 million.

To boost the company’s profitability, Lucid appointed Napoli as CEO in April. Under his leadership, the company produced 24% more vehicles in the second quarter than in the same period of 2025—4,774 vehicles. This fell short of Wall Street’s expectations, Bloomberg notes. The reduction in production was intentional, aimed at reducing inventory and freeing up cash, the company explained.

Analysts are cautious in their assessment of the company's prospects: eight of them recommend holding Lucid shares, three recommend selling, and only two recommend buying. The average target price of $7.33 is slightly below the stock's closing price on August 4.