EV startup Lucid is going to cut about 18% of its workforce

Electric vehicle maker Lucid Group Inc said on Tuesday it would lay off about 18% of its workforce, or about 1,300 employees, to cut costs as part of a restructuring plan.

The maker of Air luxury sedan last month predicted 2023 production to fall far short of analyst expectations and reported a large drop in orders in the fourth quarter.

The company plans to communicate with all its employees about the plan over the next three days, CEO Peter Rawlinson said in a letter. He added that the US workforce will be reduced in almost every organization and at every level, including executives.

Lucid, which had about 7,200 employees at the end of last year, will pay between $24 million and $30 million in related costs. The company expects to largely complete the restructuring plan by the end of the second quarter.

“We are also taking ongoing steps to control our costs by reviewing all non-critical expenses at this time,” said Rawlinson.

US companies are reining in spending as they brace for a looming recession amid aggressive rate hikes by central banks.

Industry experts say price cuts by market leader Tesla Inc and the availability of cheaper EV models from traditional automakers have weighed on demand for new vehicles from startups like Lucid and Rivian Automotive Inc.

Last month, Rivian said it would let go of 6% of its workforce in an effort to cut costs.

Shares of Lucid closed about 7% in regular trading.






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