On Sunday, Lucid Motors tweeted a picture of the first Air Dream Edition sedans leaving its Casa Grande factory in Arizona. The $169,000 car comes with by far the longest EPA-rated range among EV competitors, with up to 520 miles—besting the closest Tesla by more than 100 miles.

While all Dream Edition cars have already been snapped up by reservation holders—in keeping with the range record, production will be limited to just 520 units—new customers can order the Air in three other equipment levels. Over 13,000 reservations have been placed to date, with a planned production rate of 34,000 cars annually in the company’s launch phase.

The vehicle is hitting U.S. markets at a propitious moment. Gasoline prices are up, on average, by about 42% over the past year. Compare that with the inflation on electricity—a more manageable 5.2% increase as recorded by the Bureau of Labor Statistics. 

Lucid hopes to undercut Tesla with its Air Pure base version, capable of driving 406 miles and priced at just $77,400 excluding a $7,500 federal tax credit. That compares with 405 miles and $88,740 for Elon Musk’s long-range Model S.

Meanwhile, the highest spec series production car that Lucid customers can buy—the Air Grand Touring, for a $139,000 starting price—aims to attract buyers with 516 miles of EPA-rated range, and an industry-leading efficiency of 4.6 miles per kilowatt hour of battery.  

Lucid plans to follow up by the end of 2023 with the launch its SUV sibling, the Lucid Gravity.

Currently the only car that comes close to the Air Dream Edition is the Mercedes-Benz EQS, which is still available only in Europe. It has a certified range of 770 kilometers, or 478 miles, under the global test regime known as WLTP.

Deliveries of the Air Dream Edition had been slated to start in spring of this year before Lucid pushed the date back to the second half, citing delays stemming from the pandemic. According to the company, any further postponement posed the risk that customers might cancel and demand their refundable deposits back.

Courtesy of Lucid Motors

The brand plans to expand to the booming European EV market as early as the first half of next year, and to China come 2023. 

Luxury EV

Lucid doesn’t want to directly compete buyer-for-buyer with the Tesla Model S, however. With its greater emphasis on top-quality fit-and-finish and more liberal use of luxurious interior materials, Lucid wants to target traditional premium competitors like the Mercedes-Benz EQS, the Porsche Taycan, and the Audi e-tron GT. 

The startup may not have delivered any cars to customers, but its technology is considered proven. Lucid started out in 2007 as a battery systems supplier called Atieva, and its power plants have been used exclusively in the Formula E, the racing circuit for electric vehicles.

Lucid’s experience with battery systems is apparent in the recharging speeds it offers. While most EVs use a 400-volt electrical system, Porsche and Hyundai use an 800-volt system to speed up recharging. Lucid, however, uses over 900 volts, which means drivers can add 300 miles of range in 20 minutes.

Challenges

Shipping the first batch of finished cars is one thing. Maintaining a steady stream of production is another. Lucid has warned that supply-chain disruptions and ramp-up problems could constrain its ability to build cars at scale. 

Courtesy of Lucid Motors

The company raised $4.4 billion from its reverse listing via a merger with blank check SPAC vehicle Churchill Capital IV Corp. Nearly two-thirds of the shares in Lucid are owned by the Saudi monarchy via Ayar Third Investment Company.

Nevertheless the future is uncertain. Lucid has accumulated red ink since it was founded, amassing a cumulative loss of $4.5 billion through the end of June. It forecasts further “substantial losses and increasing expenses for the foreseeable future” and even warns it may never achieve profitability.

That hasn’t stopped investors from plowing into the stock, though. Its equity is currently worth nearly $40 billion already, roughly 60% of the value at which established premium carmaker BMW Group trades.