The Lucid Air Pure is too expensive to qualify for the revised $7500 federal tax credit. The price cap for qualifying sedans is $55,000, and the Lucid Air Pure RWD model started at $7500. But Lucid announced a price cut Thursday, dropping the entrance cost of the luxury sedan to $69,900.
The cut should help the brand deal with slackening demand for the Air. It follows similar price cuts for other Air models. The rear-wheel-drive version of the Pure was initially advertised as having an effective price of $69,900 to qualified buyers, as the previous iteration of the federal tax credit took $7500 off the $77,400 sticker price. But like many EV manufacturers, Saudi-owned Lucid was blindsided by stricter tax credit rules laid out in the Inflation Reduction Act. The bill set a price cap of $55,000 for sedans and $80,000 for trucks and SUVs to be eligible for federal discounts.
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What’s Going On With Lucid
Lucid launched the all-electric Air in 2021. The Air is the longest-range EV on sale and an acclaimed luxury sedan. Yet that hasn’t been enough to keep demand up in the face of growing competition. The brand CEO admits that Lucid’s 2023 results didn’t meet expectations, but insists that the brand is charging ahead with a clear vision for the future.
That hasn’t been good news for Lucid, which has struggled to find firm footing in the competitive luxury EV space. The Air itself has received rave reviews, with world-beating range and a luxurious driving experience. But the company lost $430,000 for every car it made in the third quarter of 2023, saw production outpace deliveries (a sign of waning demand), and had to raise more money midway through last year. Most of that money came from the Private Investment Fund of Saudi Arabia, the brand’s majority owner. That itself poses risk for a brand that is trying to pitch itself as a sustainable upstart disrupting the fossil fuel industry.
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Lucid CEO Peter Rawlinson, however, sees reason for optimism. In interviews with InsideEVs, he cited ongoing improvements to the factory, the impending launch of the Gravity SUV, and long-term plans for a more affordable model as key drivers of the company’s growth. That may be true, but the company has invested a lot of money in the Air, and it can’t let its first product wither. The price cut should help demand, albeit at the expense of Lucid’s already brutal profit margins (or lack thereof). If you need one more perk to sweeten the deal, note that Lucid will also give Air buyers a $1000 credit toward a charging accessory of your choosing. If that’s not enough, we’re not sure what else the company can do.
