Lucid (NASDAQ:LCID) might not be a big name in electric vehicle stocks. Still, it’s making quite an impact on the sector in today’s trading. It’s down nearly 7% at the time of writing, largely thanks to a massive new recall effort hitting the company hard.
Lucid is recalling over 2,000 of its Air model electric vehicles thanks to a faulty heating element. More specifically, it’s a faulty high-voltage coolant heater that delivers cabin heating and window defrosting, which is vital for most during the winter and well into both spring and fall. The vehicles impacted were produced in 2022 and 2023, and there are at least another 25 vehicles that had delamination failures in their heating system. Lucid’s plan features a software update that will identify failures and warn the driver. Then, the driver can get a free replacement system from Lucid itself.
Percentage-Wise, It’s a Nightmare
It might not sound like a big deal up front; 2,000 cars are having heating issues. For a legacy automaker, it would be the kind of thing we shrug off. It could happen to anyone, really. But for Lucid, it’s a very big deal; it delivered only 6,001 electric sedans in total for the entirety of 2023. Considering the kind of money that went into Lucid—back in 2018, the sovereign wealth fund for Saudi Arabia dropped $1 billion into Lucid’s coffers—that’s got to hurt. And given that the company managed to produce a total of 8,428 electric vehicles for 2023, falling short of its production goal of 14,000, it’s an insult to injury that many would now need to be recalled to address a heating system failure.
What is a Fair Price for Lucid Stock?
Turning to Wall Street, analysts have a Hold consensus rating on LCID stock based on eight Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 62.67% loss in its share price over the past year, the average LCID price target of $5.09 per share implies 69.1% upside potential.
