Electric car start-up needs money... and a lot of it

It’s a trick very few start-up automakers have learned, let alone mastered. Promising to build evolutionary cars is one thing (we’ve see it time and time and again in the business), but having a solid foundation of financing in place is another thing entirely. Ambitious companies often fail simply because they don’t have the money to see projects through. Though it would be unfair to put Lucid Motors in that category, its goal of launching the Air electric car just became a little more difficult after getting the cold shoulder from Ford on a potential takeover.

To be fair, Lucid is far from being in dire straits as talks with Ford have not completely gone to waste, according to Bloomberg. The Michigan-based automotive giant simply isn’t looking to make a deal at this point in time, especially when new CEO Jim Hackett is still in the middle of a 100-day review of the automaker’s own plans and priorities moving forward. The timing, apparently, isn’t just right at the moment, although a source close to the talks also told Bloomberg that Ford isn’t shutting the door completely on Lucid’s proposal. Ford does have big plans to be a major player in the electric car industry and having Lucid under its wing could help get the Blue Oval there. For now, Lucid still doesn’t have the money in place to move forward with its own plans for the Air electric sedan. How long this hold-out lasts will likely determine the fate of the company.

Continue after the jump to read the full story.

Don’t lose hope on Lucid Motors yet

Past history hasn’t been kind to start-ups who need massive financing to get their projects off the ground. Faraday Future is a perfect example of that.

It’s easy to see the writing on the wall and determine Lucid Motors’ fate because of it. Past history hasn’t been kind to start-ups who need massive financing to get their projects off the ground. Faraday Future is a perfect example of that. It promised the world when it presented the Faraday Future FF91 and laid out its plans to build a giant facility in Las Vegas. Now, construction of the facility has stopped and the man financing the whole thing, LeEco founder Jia Yueting, is under investigation in China for unpaid loan payments.

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Lucid Motors Is Learning The Dark Side Of The Business The Hard Way Exterior High Resolution
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It would be unfair to put Lucid Motors in the same conversation as Faraday Future because they’re in two different predicaments at this time. For one, Lucid is taking a more measured approach with its plans, presumably because it doesn’t want to suffer the same fate as Faraday Future. Instead of jumping straight into the deep pool without knowing how to swim, Lucid is taking it step-by-step. It’s hired Morgan Stanley to help raise money to pay for further development of its vehicles. Even its approach to Ford looking to strike a possible deal is a sign that the company wants to make sure it has a sturdy basket to put all of its eggs in.

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The goal itself is to get the money first before moving on to the next stage of the car’s development.

The goal itself is to get the money first before moving on to the next stage of the car’s development. “We don’t have the money in place,” said Chief Technology Officer Peter Rawlinson back at the New York International Auto Show in April. “It would be irresponsible to start moving earth or start anything until we have a financial runway to execute that professionally and with absolute integrity.”

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Hopefully, it gets the funding it needs to proceed with its ambitions. Whether or not Ford will be a part of it remains to be seen, but it is a good sign that the people running Lucid Motors knows where its priorities are and understands its limitations at this stage in the company’s development. So don’t lose hope on Lucid just yet. If anything, it’s approaching this roadblock the way so many other failed start-ups in the past should have.

References

2018 Faraday Future FF 91 Exterior Computer Renderings and Photoshop
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Read our full review on the Faraday Future FF 91.

Lucid Motors Is Learning The Dark Side Of The Business The Hard Way
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Read our full review ont he Lucid Motors Air

Source: Bloomberg

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