Lucid (LCID) has no plans to launch a $20,000 EV, but it could help create one

That $20,000 luxury Lucid EV you’ve been waiting for will likely never hit the market. CEO Peter Rawlinson said Lucid (LCID) has no plans to launch a $20K vehicle. However, it could play a role in bringing cheaper EVs to market.

After its third straight quarter of record deliveries in Q3, Lucid is gaining traction. The EV maker is now outselling its German luxury rivals in the US, including the Porsche Taycan and Mercedes EQS.

Lucid’s Air even outsold the Tesla Model S in the third quarter. According to Kelley Blue Book, Lucid sold 1,944 Air models in Q3, up 33% from last year, while Tesla Model S sales slipped 47% to 1,669.

The company’s growing sales come despite many media headlines claiming that EV sales are slowing or cooling.

On The Wall Street Journal’s recent Bold Names podcast, Rawlinson said there is a “false narrative” that EVs are in decline. Sales are still up, Rawlinson explained, but they may not be climbing as fast as some had predicted.

Lucid’s CEO is not surprised by some legacy automakers’ “lame efforts.” According to Rawlinson, the company was established for a different reason. Lucid exists “to advance the state of the art of EVs,” the company’s CEO said on the podcast.

Is Lucid launching a $20K EV?

In 2021, Lucid launched the first EV with over 500 miles range. To this day, “There’s no competitor within 100 miles of that car,” according to Rawlinson.

Lucid is focused on efficiency or enabling more range with fewer batteries. To promote widespread adoption, Rawlinson said we must hit the core issue: the cost of batteries as a function of their size.

To get there, Lucid had to start with a high-end premium product, its luxury Air sedan. The company’s leader said Lucid exists to advance “the state of the electric car” with its advanced tech. In other words, it is about driving down costs while unlocking more driving range with smaller, more efficient technology.

So does this mean we will eventually see a $20,000 Lucid EV hit the market? It’s still not likely. According to Rawlinson, Lucid has no plans to build a $20K EV because “that market sucks.”

Lucid’s CEO pointed to Porsche, one of the most profitable legacy automakers, saying, “It doesn’t operate in that sphere.”

Meanwhile, Rawlinson explained that Lucid is “commercially viable in the future.” He believes that is where Lucid could have an opportunity to license its tech.

Enabling cheaper EVs

Regarding a $20K or $25K EV, the company’s advanced tech will “enable that tomorrow,” Rawlinson said, but it will not be a Lucid vehicle. When asked, “Are you going to build that $20,000 vehicle?” Lucid’s CEO responded, “No, because that market sucks.”

The mass market segment has “terrible low margins,” and that’s not where the company is trying to compete.

Rawlinson said other OEMs already have the manufacturing network and could put such a vehicle in place.

The premium EV maker plans to launch several lower-cost vehicles on its upcoming midsize platform, but they will still be around $50,000. Lucid’s midsize SUV, which is due out in 2026, will be “priced around 48 to $50,000,” Rawlinson confirmed.

That’s the price range Lucid wants to do business in, but licensing its tech will enable others to make more affordable products.

Rawlinson said when the new midsize model model launches, “we become a Tesla competitor, head-to-head.” Lucid’s CEO said he believes the upcoming EV will be “massively better than a Tesla Model Y.” He added:

Because of our technological advantage, we should be able to make that car with its competitive range, but with less batteries than anyone else.

According to Rawlinson, doing so will not only save resources but also “allow a better gross margin per vehicle than anyone else.”

That is the game plan, the “chess game” Lucid is playing. Although the media portrays Lucid as a Tesla competitor now, the company is actually targeting Mercedes and Porsche. In a few years, it will challenge Tesla head-to-head with its midsize SUV.

Before that, Lucid is launching its first electric SUV, the Gravity. It has already begun taking orders for the higher-end $94,000 model, which is scheduled to enter production later this year. A more affordable $80,000 version is planned for late 2025.

After securing another $1.75 billion through a recent capital raise, Lucid said it has enough funding for “well into 2026,” right in time for the midsize model.