S&P 500 hits a fresh record high on stronger economic growth, Nvidia pares losses
On Thursday, Benchmark provided insights into the electric vehicle (EV) sector, focusing on the effect of newly imposed tariffs. The research firm highlighted that Tesla (NASDAQ:TSLA), Rivian (NASDAQ:RIVN), and Lucid Motors (NASDAQ:LCID) might face less impact from these tariffs compared to their peers due to their domestic production facilities. Lucid, currently trading at $2.26, has demonstrated strong revenue growth of 35.7% over the last twelve months, though InvestingPro analysis indicates the company faces profitability challenges.
According to Benchmark, the auto industry has been dealing with an uncertain regulatory landscape, which has been further complicated by the introduction of tariffs. However, since Tesla, Rivian, and Lucid manufacture their vehicles within the United States, the firm anticipates that the impact of tariffs on these companies will be relatively muted when compared to other traditional automakers. InvestingPro data shows Lucid maintains a strong liquidity position with a current ratio of 4.18, though it’s currently burning through cash rapidly.
The firm also reported that for the first two months of 2025, U.S. EV sales have seen a significant year-to-date increase of 28%, as per data from Rho Motion. This surge in sales could be attributed to consumers taking advantage of available incentives before they are potentially phased out.
Despite the potential removal of some incentives, Benchmark remains optimistic about the EV industry’s prospects. The firm believes that the sector can sustain its robust growth trajectory. This positive outlook is based on the anticipated improvements in vehicle affordability, the expansion of charging infrastructure, and enhancements in EV functionality, which are expected to support long-term market expansion. According to InvestingPro, which offers comprehensive analysis and 13 additional ProTips for Lucid, analysts anticipate continued sales growth for the company in the current year, though the stock remains undervalued based on InvestingPro’s Fair Value calculations.
Benchmark’s analysis suggests that the recent challenges posed by tariffs and regulatory changes might not significantly hinder the growth of Tesla, Rivian, and Lucid Motors. The firm’s commentary provides a nuanced view of the current state of the EV industry and its resilience in the face of macroeconomic headwinds.
In other recent news, Lucid Group announced its first-quarter production and delivery figures, revealing that the company delivered 3,109 vehicles, surpassing Visible Alpha’s consensus estimates. However, production numbers fell short, with 2,212 vehicles produced, below Cantor Fitzgerald’s estimate of 3,600. Cantor Fitzgerald maintained its Overweight rating on Lucid Group, with a $3.00 price target, noting the positive delivery performance despite the production shortfall. Additionally, Lucid plans to offer $1 billion in convertible senior notes due in 2030, aiming to repurchase existing notes and support general corporate purposes.
In other developments, Lucid is facing unconfirmed delays in delivering its Gravity SUV due to safety issues, which could affect its production timeline. These delays occur as investors closely watch Lucid’s ability to meet production targets. Meanwhile, Cantor Fitzgerald also maintained a Neutral rating on Lucid, citing challenges such as high negative gross margins and management changes. Despite these challenges, the firm acknowledged Lucid’s advancements in electric vehicle technology, including superior battery efficiency and performance.
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