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NEWARK, Calif. - Lucid Group, Inc. (NASDAQ: LCID), known for its advanced electric vehicles and currently valued at $6.7 billion, has entered into a multi-year supply agreement with Graphite One, ensuring a steady supply of American-sourced natural graphite. This move aims to bolster Lucid’s supply chain with US raw materials. According to InvestingPro data, the company maintains a strong liquidity position with more cash than debt on its balance sheet.
The agreement, announced today, will see Graphite One supply natural graphite to Lucid and its battery cell suppliers starting in 2028. The material will be mined from the Graphite Creek deposit in Alaska. This deal complements a previous agreement from 2024, under which Graphite One will provide synthetic graphite from a facility in Ohio, also beginning in 2028. While Lucid’s revenue grew by 41% in the last twelve months, InvestingPro analysis reveals the company is currently experiencing rapid cash burn, a critical factor for investors following the stock’s recent performance.
Marc Winterhoff, Interim CEO at Lucid, emphasized the strategic importance of securing a US-based supply chain for critical materials, highlighting the benefits to the national economy, independence, and efforts to reduce carbon footprints.
In a similar vein, Lucid has also partnered with Syrah Resources to procure natural graphite anode material (AAM) starting in 2026. Syrah will supply from its integrated production facility in Louisiana.
These partnerships are part of Lucid’s broader strategy to source essential minerals locally and strengthen its US-based supply chain. Graphite is a crucial component in Lithium-Ion batteries, necessary for their high-performance and fast-charging capabilities.
The announcement is based on a press release statement from Lucid Group.
In other recent news, Lucid Group Inc. has reported its first-quarter financial results for 2025, showing an adjusted EBITDA loss of $263.5 million, consistent with Stifel’s projections. Despite flat revenues, the company managed to reduce its cash burn to $589.5 million, down from $824.8 million in the previous quarter, due to effective cost optimization and increased regulatory credit sales. Lucid has maintained its production target of 20,000 vehicles for the fiscal year 2025, a figure that aligns with Cantor Fitzgerald’s expectations. The company began manufacturing its Air Gravity SUV in late 2024, with deliveries starting in the first half of 2025, and plans to launch the Gravity Touring model later in the year.
Both Stifel and Cantor Fitzgerald have maintained their ratings on Lucid, with Stifel holding a "Hold" rating and Cantor keeping a "Neutral" rating, each with a $3.00 price target. These firms have acknowledged Lucid’s strong partnership with the Public Investment Fund and its advanced EV technology. However, concerns remain about Lucid’s high negative gross margin, potential need for additional capital, and the challenges posed by tariffs and a new management team. In expansion news, Lucid has opened a new Studio and Service Center in Rutherford, New Jersey, marking its 43rd location in North America. This move is part of Lucid’s strategy to increase accessibility and service as demand for electric vehicles continues to rise.
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