EV pre-orders pick up as production tightens

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Electric vehicle preorders picked up in the second quarter at major EV manufacturers as production continues to lag behind demand.  

At Newark, Calif.-based luxury EV manufacturer Lucid Motors, reservations rose 23.3% sequentially to 37,000 vehicles in Q2, representing potential sales revenue of about $3.5 billion, according to the company’s Wednesday earnings release. That’s compared to 30,000 reservations, or $2.9 billion in potential sales, in Q1. Lucid produced 1,405 units in the first half of the year, with vehicle deliveries totaling 679 units in Q2. 

Manhattan Beach, Calif.-based EV manufacturer Fisker Inc., meanwhile, received a total of 56,000 reservations for the Fisker Ocean as of Monday, with production set to begin Nov. 17, according to the earnings release. 

Ocean reservations are up 24.4% from May 2, giving the manufacturer a potential revenue of $350 million, founder and Chief Executive Henrik Fisker said during the earnings call. 

Fisker will accept pre-orders for the Ocean Extreme starting Nov. 18, and pre-orders will open for the Ocean Ultra and Ocean Sport in Q1 2023, according to the company. Production on the Ultra and Sport trims is set to start next year. 

Lucid cuts production guidance 

Still, it remains to be seen when Lucid will actually be able to deliver on those vehicles. The EV OEM once again announced a cut in production volume for 2022 to a range of 6,000 to 7,000 vehicles due to supply chain constraints, a 50% decrease from projected 12,000 to 14,000 vehicles in the first quarter, according to the Q2 earnings release. The anticipated production volume will fill only about 19% of the EV manufacturer’s production capacity of 34,000 units per year. 

However, production volume is set to increase to 90,000 units per year by early 2023 with the expansion of the company’s Casagrande, Ariz.-based factory, Sherry House, chief financial officer at Lucid, said during the earnings call. 

In addition to reservations, Lucid has an incremental agreement with Saudi Arabia to purchase up to 100,000 vehicles, Chief Executive Peter Rawlinson said during the call. 

To prepare for expected growth, Lucid inked a deal to secure additional capital with the purchase of a $1 billion asset-based lending (ABL) facility. Currently, Lucid can borrow up to $250 million based on eligible assets, House said. The ABL also has an accordion feature that adds an additional $500 million, but it is not committed yet, she noted. 

Lucid’s cash and cash equivalents clocked in at $3.2 billion at the end of Q2, down 49.5% from yearend 2021, according to the earnings release. Capital expenditures in the first half of 2022 clocked in at $494.9 million and are expected to total about $2 billion for the full year, House said. 

Lucid Motors inked a private label deal with Bank of America at the beginning of June, creating Lucid Financial Services, which will offer leases and loans on Lucid vehicles. 

Meanwhile, Fisker’s cash and cash equivalents sat at $851.9 million in Q2, down 29% compared with yearend 2021, according to the earnings release. The company expects capital expenditures between $715 million and $790 million for 2022.  

Fisker has a private label financing arrangement with Chase Auto that was inked in March. 

© Can Stock Photo / epantha

Expanding production capacity 

Lucid is also looking to expand its production capacity. The OEM’s new Saudi Arabia plant, announced last quarter, will have a production capacity of 155,000 vehicles per year, according to the earnings presentation. 

Lucid also added five new studios for a total of 29 studios across the U.S., Canada and Europe, and built its first European studio in Munich, concurrent with launch plans for the European market, House said.  

The first shipment of the Lucid Air to Europe and Saudi Arabia is expected to ship by the end of the year, Rawlinson said. 

Shares of Lucid Group Inc. [Nasdaq: LCID] were trading up 2.88% from market open at $18.56 as of market close today. Lucid has a market capitalization of $30.96 billion. 

Shares of Fisker Inc. [Nasdaq: FSR] were trading at $10.38, down 1.42% as of market close today. Fisker has a market capitalization of $2.92 billion. 

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Source : AutoFinanceNews