SPAC Wars: Lucid Motors Vs. Faraday Future — Battle Of The Luxury Electric Vehicles

The debut of Lucid Group Inc LCID trading this week marks another electric vehicle company going public via SPAC merger.

The hosts of Benzinga’s “SPACs Attack” featured two prominent electric vehicle companies — Lucid Group and Faraday Future — focused initially on the luxury segment in a SPAC Wars battle.

Lucid Motors: Company CEO Peter Rawlinson appeared on CNBC Monday and Lucid Group rang the opening bell, creating some increased brand awareness, co-host Chris Katje said.

In the last CNBC appearance, Rawlinson highlighted the company’s Arizona factory. Monday the talk centered on cash and the company being funded through fiscal 2022.

“Lucid is on track to start deliveries by the end of the year,” Katje said.

The Lucid Air Dream Edition has 10,000 reservations. This is the more expensive version of the car before it goes after the mass market for electric vehicles.

“There’s also going to be a cheaper version, $69,900 in 2022," Katje said.

Katje mentioned that Tesla Inc TSLA had 12,000 reservations of its Tesla Model S the summer before its deliveries.

“They’re going to get compared to Tesla all their life,” he noted.

Lucid and Tesla both have strong demand and hype prior to releasing a car to the public.

Lucid comes with high optimism and a plan to produce 365,000 units annually.

“You’re pushing yourself to have pure success,” co-host Mitch Hoch said based on the lofty production numbers.

Katje also said the company is incredibly optimistic, which could be a cautionary tale for investors.

“Any setback could be a major loss for share. Is there some risk priced in or is the price today based on them hitting all their objectives?”

Related Link: SPAC Wars: Virgin Galactic Vs. Blacksky, The Battle For Space 

Faraday Future: Recent de-SPAC Faraday Future Intelligent Electric FFIE is following a similar path to Lucid with a focus first on luxury electric vehicles before a less costly one for a larger market of customers.

Katje said it was important with a direct-to-sales model that the company just opened the FF91 experience in New York City giving a first-hand look at the vehicle to potential buyers.

Faraday’s SPAC PIPE included an investment from Chinese automotive company Geely Automotive.

“Faraday could become more of an international story in the luxury market," Katje said.

The company is also incredibly focused on technology both inside and outside the vehicle.

More than 14,000 reservations of the FF91 electric vehicle put the company ahead of Lucid in pre-orders. Faraday plans to sell over 400,000 units in the next five years, making it optimistic for success similar to Lucid.

Faraday has plans for cheaper models down the road but Katje thinks these are years away.

“They’re playing a somewhat different strategy. Lucid and Faraday think a hole is left in the luxury market and can do a cheaper model later.”

Faraday is also focused on bringing a last-mile delivery vehicle to market and basing its financials on units of both the electric vehicles and delivery vehicles. Estimates call for $21 billion in revenue for fiscal 2025.

“That’s a pretty big estimate,” Katje said.

The Winner: Viewers of “SPACs Attack” picked Lucid Motors as the winner with a 2:1 ratio of votes.

Disclosure: Author is long shares LCID.