Rivian and Lucid Might Not Get As Lucky As Tesla

• EV startup Lucid’s CEO Peter Rawlinson stated the firm could have to contemplate cost increases.
• It truly is very little new for EV startups: Tesla was no stranger to value hikes, provide troubles, and delays.
• Continue to, startups like Lucid and Rivian might not get the identical leeway from prospects that Tesla has.

Past week, the CEO of electric powered carmaker Lucid reported the startup may well have to raise car rates in the foreseeable future — and the enterprise is hoping for the exact leniency Tesla has gotten for doing the identical in excess of the decades.  

Several issues are hobbling the vehicle business ideal now, and Lucid is no exception. Setting up a worthwhile automobile is not at any time easy, enable alone in a competitive sector the place automakers are grappling with offer chain hiccups and products shortages exacerbated by the conflict in Ukraine. 

Lucid said in its most up-to-date earnings simply call that glass, carpeting, and exterior trim pieces ended up amid the trickier materials to safe. It also dropped its 2022 creation focus on from 20,000 autos to in between 12,000 and 14,000.

Lucid’s not the only a person searching to go expenses on to customers. In early March, rival EV startup Rivian lifted selling prices for its flagship R1T and R1S EVs. Afterward, the company’s stock dropped and prospects threatened to cancel their reservations. Tesla has accomplished this type of matter for yrs, routinely raising or decreasing its rates based on many problems. Certainly, its most affordable Design 3 now expenses $10,000 a lot more than it did last calendar year.

For the most component, Tesla’s carried out so with minimal griping from buyers — nothing like the uproar that compelled Rivian CEO RJ Scaringe to backtrack and say its value hike wouldn’t implement to present reservation holders. (Rawlinson indicated Lucid would do the identical for its more than 25,000 reservations.)

Now, the concern for Lucid and Rivian is whether they are going to get the exact forgiveness that early Tesla buyers awarded Elon Musk’s automaker. Experts are not positive.

“When people today acquired Teslas in 2012, they were extremely unique from what was getting supplied,” Gartner automotive analyst Mike Ramsey reported. A delicate cost hike was not enough to dissuade someone who truly wished a able electric powered car or truck. 

Now, the price “is a truly difficult factor to swallow if you might be already an individual having a danger on one of these companies, simply because there are corporations out there previously that have a item, like Tesla or some of the big suppliers,” Ramsey claimed. 

Lucid did not answer to ask for for comment. 

So, the up coming wave of Lucid potential buyers could possibly not be as lenient as Tesla’s purchasers have lengthy been, especially with a couple of fixes nevertheless to make (fixes that may not be needed in competitor’s motor vehicles).

For instance, Lucid house owners have advised Insider they’re impressed with the Air (as of February 28, the enterprise had delivered 300), but are divided on the software. Some, like Jon Rettinger, a Lucid operator in California, touted the Air’s in good shape and complete good quality, and acknowledged the program is in its infancy and simply updatable. 

But others mentioned for the $169,000 price tag level (special to Lucid’s Dream Version, of which only 520 will be built its Grand Touring, Touring, and Pure styles are priced at $139,000, $95,000, and $77,000, respectively), the computer software desired to be a lot more completely ready at delivery. “I felt like the motor vehicle wasn’t prepared to be delivered when I bought it,” reported 1 Lucid proprietor in Texas, who asked for to stay anonymous but whose identity is known to Insider. 

Shifting ahead

These difficulties aren’t exceptional to Lucid. Tesla has noticed quite a few high quality troubles and software difficulties, specifically encompassing its Autopilot program, even although it’s a reasonably recognized automaker now.

“It is a very unique time, and there is considerably less tolerance,” on pricing, Rettinger said. But, “This is not new.” 

Nonetheless, any issues could nevertheless have a various affect on today’s EV startups than they did for Tesla. 

“If they’re delaying the vehicles, and then they’re placing the price tag up, and then they’ve got application challenges,” Berylls managing director Martin French said of Lucid, “then I feel possibly they’re likely to have pretty, pretty affected person and loyal prospects, or I do think people today will start out searching all over at that rate point.”