Lucid Motors Announces Layoffs Affecting 18% of Workforce, Says Memo
Luxury electric vehicle startup Lucid Motors plans to lay off hundreds of employees, affecting approximately 18% of the company, according to an internal memo and five anonymous sources reported by Business Insider.
The announcement was made during an all-hands meeting by CEO Peter Rawlinson. With around 7,200 employees globally at the end of 2022, this would mean roughly 1,290 employees would be affected by the decision.
The memo indicated that details about the layoffs would be communicated in the following three days and would impact every organization and level within the company, including executives.
Affected employees are expected to receive a severance package, including access to career resources, healthcare coverage continuation, and acceleration of equity. The memo cited cost discipline as the reason behind the layoffs, stating that the company’s cost structure optimization efforts alone wouldn’t achieve its objectives and that the decision to let team members go was “painful but necessary.”
Lucid has faced challenges in recent months as it struggles with manufacturing, production, and getting vehicles on the road. Rawlinson emphasized in last month’s fourth-quarter earnings call that sales, marketing, and brand recognition would be priorities for 2023, stating, “My focus now is on amplifying the message, attracting a broader audience, and ramping up our sales.”
The company’s Q4 2022 saw revenue fall short of expectations, while only seeing $258 million in revenue, short of Wall Street’s estimates pegged at over $303 million.
Lucid Motors ended 2022 with roughly $4.4 billion in cash and $500 million available through lines of credit, which it said would be ample to last through Q1 of 2024. The company was only able to manufacture 7,000 Air sedans in 2022, however, it claims production between 10,000 to 14,000 in 2023. This memo doesn’t make it sound convincing that Lucid can turn its ship around.