Rising interest rates to curb inflation and fears of recession have dampened consumer demand, prompting market leader Tesla to slash prices this year.
SAN FRANCISCO — Electric vehicle maker Lucid Motors cut prices of its Air luxury sedans by as much as $12,400 as part of an offer, it said on Saturday, amid rising competition in the U.S. EV industry and a price war sparked by Tesla Inc.
Lucid reduced the price of the Air Pure by $5,000 to $82,400 from $87,400, and cut prices of the more powerful Touring and Grand Touring versions by $12,400 to $95,000 and $125,600, adding that the offer would be valid as long as supplies last.
A spokesperson for Lucid said the company was unable to provide details on how much inventory will be part of this offer.
Tesla’s Model S and its performance version Model S Plaid — direct competitors with the Air — are priced at $88,490 and $108,490 down from $104,990 and $135,990 at the beginning of the year.
Over a year ago, Lucid, which is majority owned by Saudi Arabia’s Public Investment Fund, and its peers had to raise prices of its cars as rising raw material prices and nagging supply chain bottlenecks sparked by COVID-19 hit the automotive industry hard.
But rising interest rates to curb inflation and fears of recession have dampened consumer demand, prompting market leader Tesla to slash prices this year.
That has sent ripples through the industry, making it difficult for money-losing startups such as Lucid, which also face competition from traditional automakers launching EVs, to grab market share.
Helping some lower-priced models woo customers is a $7,500 federal tax credit under the Inflation Reduction Act, but more expensive cars such as Lucid’s Air are not eligible.
Newark, Calif.-based Lucid is expected to show deepening losses in its second-quarter earnings on Monday after reporting a fall in April-June production due to supply-chain problems.
