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Shares of Lucid Group (LCID 4.46%) are rising sharply today. While the electric vehicle (EV) maker hasn’t yet released its own fourth-quarter production and delivery figures, data from its peers is giving investors reason to be optimistic.
At 11:15 a.m. ET, shares of Lucid were higher by 7.9%. That is contributing to the stock’s massive 51% move higher over the last month.
Fears of lagging EV demand may be misplaced
Investors spent much of 2024 worrying that consumer demand for EVs was dropping. Legacy automakers throttled back plans to increase EV production for that reason. Yesterday, sector leader Tesla reported that annual delivery volume dropped year over year for the first time since it began meaningful production levels.
Today, EV start-up Rivian Automotive also reported a drop in annual production, but it beat its prior guidance. More importantly for Lucid investors, both Tesla and Rivian showed something that indicates consumer demand remains healthy.
Rivian’s annual production volume exceeded prior guidance, while deliveries were in the range it had previously provided. But both Rivian and Tesla reported that fourth-quarter vehicle deliveries were higher than production levels. So inventory declined for both companies, which bodes well for upcoming financial results. Tesla reduced vehicle inventory by about 36,000 units in the fourth quarter, while Rivian reduced its inventory level by about 1,500 EVs. That represents most of the 2,100-unit inventory level drop for the full year.
Lucid investors seem to be taking that as a positive sign for its fourth-quarter results. It hasn’t released those results yet, but last year it released them on Jan. 11, so it’s likely investors will get that update for 2024 next week.
Howard Smith has positions in Lucid Group, Rivian Automotive, and Tesla. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.
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