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Investing.com -- Shares of Lucid Group (NASDAQ:LCID) tumbled 4.6% following news that the company is facing delays in the delivery of its highly anticipated Gravity SUV due to safety issues. The luxury electric vehicle maker has been grappling with production challenges, as early production was hindered by unresolved safety testing, particularly concerning the third-row seating of the vehicle.
According to EV, citing a source familiar with Lucid’s launch plans, the interim CEO, Marc Winterhoff, assured during an event last week that deliveries to U.S. customers are expected to commence by the end of April. However, the same source indicated that behind-the-scenes progress has been slow, with the Gravity model yet to pass safety testing for its third-row seating.
The delays have cast a shadow over Lucid’s production timeline, with the source revealing that while some deliveries may begin as stated by the CEO, the volumes in April will be "very small." The source further suggested that higher-volume production is not anticipated to ramp up until June or July.
This setback comes at a time when investors are closely monitoring Lucid’s ability to meet production targets and manage supply chain issues. The lack of specific delivery targets for the Gravity SUV from Lucid adds to the uncertainty surrounding the company’s operational efficiency.
As the market reacts to these developments, Lucid’s stock movement reflects investor concerns over the company’s short-term performance. The news of the delivery delays highlights the challenges Lucid faces in scaling up production and meeting customer expectations for its new SUV model.
While Lucid has not officially commented on the reported safety issues or the expected production volumes, the information from the person familiar with the matter provides insight into the hurdles the company is encountering as it strives to establish a foothold in the competitive electric vehicle market.
In other EV news, Tesla (NASDAQ:TSLA) was down after reporting delivery numbers well below expectations and whispers, though the stock quickly rebounded as of 11:45 ET, gaining 4.2% on rumors that CEO Elon Musk will be ending his role in the U.S.’ DOGE. Rivian Automotive (NASDAQ:RIVN) also saw a decline of 4% after posting soft delivery numbers that slightly beat analyst expectations.
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