Why Lucid Stock Dropped Today
Yahoo Finance ·
Shares of luxury electric vehicle (EV) maker Lucid Group ( LCID 9.31% ) are tanking today. Investors can thank a rival EV maker for the move. Rivian Automotive announced a capital raise, and that has investors focusing on Lucid's capital needs, too. Lucid shares dropped as much as 10%, and remained lower by 8.6% as of 12:15 p.m. ET. Lucid could arguably be out of business had it not been for its close relationship with the Saudi Arabian sovereign wealth fund. The Public Investment Fund (PIF) is Lucid's largest shareholder and has provided capital in several investment rounds in the past few years. Most recently, Lucid withdrew $500 million in capital from the PIF-provided Delayed Draw Term Loan (DDTL). As of the end of Q1, there was still $2 billion remaining in undrawn capacity. After Rivian announced a common stock offering last night that should raise about $1.5 billion, investors may be scrutinizing Lucid's capital needs more closely.
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