Lucid Motors Delivers Record Quarter as Federal EV Tax Credit Expires

Automaker Hits 4,078 Deliveries, but the Real Challenge Lies Ahead

NEWARK, Calif. — Lucid Group just posted its strongest quarter ever, delivering 4,078 vehicles between July and September. That’s a 47% jump from the same period last year. On the surface, it looks like a huge win. But there’s a catch. The $7,500 federal tax credit that helped drive those sales disappeared the moment the quarter ended, leaving many wondering if Lucid can keep the momentum going.

Lucid revealed the numbers on Monday, the same day its stock dipped 3.1% to close at $24.02. Analysts quickly pointed out the obvious: a flood of buyers rushed to beat the September 30 deadline for the incentive. Now the fourth quarter will reveal whether that rush was just a temporary spike—or proof of lasting demand.

Tesla, Rivian, and other EV makers saw the same end-of-quarter scramble, which some analysts call “borrowed demand.” In other words, sales that would have happened later simply got pulled forward. The real test is whether Lucid can keep filling its order books without Uncle Sam’s boost.

After the Tax Credit: What Happens Next?

Losing the credit creates what industry insiders see as a perfect test of price sensitivity. Showrooms in September were buzzing with last-minute deals, and paperwork piled up in the final days. The sense of urgency was real.

But the morning after the credit expired, reality set in. Tesla quickly raised lease prices, signaling that automakers won’t keep covering the gap. For luxury-focused brands like Lucid, that’s a problem. The Air sedan starts around $80,000, while the new Gravity SUV comes in closer to $120,000. The tax break wasn’t small change—it made a difference in affordability.

Some companies are trying to soften the blow with special lease structures that mimic the incentive. Still, those programs are limited and won’t save everyone. Lucid now faces a classic luxury-car dilemma: should it lower prices to keep sales flowing, or protect margins and risk slowing down?

The Gravity SUV: Lucid’s Big Bet

Buried in Lucid’s record quarter is a key detail: the Gravity SUV is finally contributing to sales. The company hasn’t broken out exact numbers, but shipping patterns and production data suggest the SUV is beginning to land with buyers.

That’s a big deal. SUVs dominate the U.S. auto market, and Gravity gives Lucid a shot at a much larger audience than its Air sedan ever could. Early versions cost well over $100,000, which boosts revenue per vehicle. But there’s a flip side. Early production almost always comes with higher costs and slimmer margins until factories iron out inefficiencies.

So the question becomes: will Gravity truly expand Lucid’s market, or just steal sales from the Air in a different shape? The answer could decide whether the company grows enough to spread out its hefty fixed costs.

Through September, Lucid delivered 10,496 vehicles this year and produced 9,966—excluding units headed to Saudi Arabia for final assembly. To hit its own target of 18,000 to 20,000 units for 2025, Lucid will need to double its strongest quarter ever in the last three months of the year. That’s a tall order, especially while ramping up a brand-new model.

Saudi Arabia: Safety Net or Risky Reliance?

Saudi Arabia continues to play a crucial role in Lucid’s story. Its Public Investment Fund is the company’s largest backer and remains both a financial lifeline and a ready-made customer. More than 1,000 vehicles were shipped for final assembly there last quarter—a meaningful share of Lucid’s output.

On the one hand, this setup gives Lucid stability, insulating it from sudden U.S. policy changes. On the other, it puts a lot of eggs in one basket. Saudi priorities could shift with oil prices or regional politics, leaving Lucid vulnerable. A full Saudi factory, expected later this decade, might cut costs and speed up deliveries, but it also deepens that dependence.

Self-Driving Ambitions: Still Years Away

Lucid has also been talking up its partnership with Uber and self-driving developer Nuro. The plan calls for 20,000 autonomous Lucid vehicles hitting the road starting in 2026. It sounds futuristic, but history tells us to be cautious.

Across the industry, robotaxi projects have moved slower than expected, tripped up by tough regulations, tech hurdles, and insurance challenges. For now, analysts treat Lucid’s robotaxi promise as more of a “nice-to-have” story than a reliable revenue stream. If it pays off, it’ll likely be years down the road.

All Eyes on November 5

Lucid reports its full third-quarter results on November 5. Deliveries are only part of the story. Investors want to see whether growing volumes actually improve margins, or if launch costs and incentives continue to weigh down each car sold.

Another key figure: how many new orders came in after the tax credit expired. That will show whether Lucid’s demand holds up without subsidies—or if September was just a sugar high.

The company had about $4.86 billion in cash mid-year, but that cushion won’t last forever. With expensive projects like Gravity and the Saudi plant draining funds, analysts increasingly believe Lucid will need to raise more capital in 2026.

Can Lucid Keep Its Spark?

Lucid has proven it can generate buzz and boost sales when incentives line up. But that’s not the same as proving staying power. Demand elasticity is clear. Demand sustainability remains a question mark.

The coming months will offer clues. If Gravity finds strong traction, it could widen Lucid’s reach. If Saudi localization cuts costs, the business model improves. But if orders falter now that subsidies are gone, the company may face a long uphill climb.

History suggests that capital-heavy car startups face stark choices. Either they scale fast enough to survive on their own, or they keep raising money, diluting early investors along the way. Lucid’s record quarter shows promise. Whether it marks the beginning of real growth—or just a high-water mark—will become clearer soon.

House Investment Thesis

Category	Details & Data	Analysis & Opinion
Company & Stock	Company: Lucid Group Inc. (USA Equity) Current Price: $24.02 USD Change: -$0.76 Open: $24.82 USD Intraday Volume: 7,467,857 Intraday High/Low: $25.21 / $23.51 USD Last Trade: Monday, October 6, 23:14:13 +0200
Q3 2025 Results	Deliveries: 4,078 (+46-47% y/y), below expectations. Production: 3,891, plus >1,000 for Saudi final assembly. YTD (Sep): 10,496 delivered / 9,966 produced. Catalyst: Demand pulled forward into Sept 30 cutoff for $7,500 EV tax credit.	Incremental View: This was a demand elasticity quarter, not proof of structural demand. Expect Q4 deliveries to decline sequentially.
2025 Guidance & Math	Official 2025 Production Guide: 18k–20k (trimmed Aug 5). Run-rate: Needs ~8k-10k units in Q4 to hit guide, well above any prior quarter. Liquidity (Q2): ~$4.86B.	Delivery Forecast (Opinion): Base Case (FY25): 13k-14k. Bull Case: 15k+. Bear Case: sub-12.5k. Hitting the official guide is seen as unlikely.
Gravity SUV Ramp	Gravity SUVs are now appearing in the delivery mix.	Helpful for ASP and traffic, but carries negative early unit margins. Not expected to flip gross margin positive near-term.
Saudi Arabia (KAEC)	Current: Critical volume lever (SKD assembly). Future: CBU (Complete Build-Up) targeted after mid-decade.	Benefit: Smooths demand, lowers landed costs over time. Risk: Policy concentration and geopolitical optics.
U.S. Incentives	The $7,500 federal EV purchase credit expired for new orders after Sept 30, 2025. Some OEMs are testing lease workarounds.	The expiry is a significant headwind, especially for premium EVs. Lease workarounds are finite and not a full backstop.
AV / Fleet Optionality	Plan with Nuro/Uber to deploy 20,000+ vehicles over six years, starting in 2026.	Treat as a call option. Heavily discount timing/volume until real-world data and approvals are seen.
Key Metrics for Nov 5 Earnings	1. Gross margin bridge. 2. Post-Sept 30 order intake (book-to-bill). 3. Saudi localization roadmap and cost deltas. 4. Cash flow, capex, and liquidity update.	These will set the 2026 narrative.
Liquidity & Capital	With negative vehicle margins into 2026 and elevated capex.	Expect an additional external capital raise in 2026, likely from PIF.
Trading Framework	Base Case: Q4 deliveries down, stock churns. Bull Case: Gravity surprise, resilient orders, Saudi ramp. Bear Case: Deep demand air pocket, margin pressure, equity raise chatter.	Longs: Need sustained post-credit intake & Gravity/Saudi execution. Shorts: Catalyst is Q4 demand air pocket.
Bottom Line	Q3 proves elastic demand and multi-channel execution.	The next leg of the thesis lives or dies on Gravity's ramp, post-credit order health, and Saudi localization driving costs down. Base case remains cautious.

Investors should consult financial advisors before making portfolio decisions. The EV market is evolving rapidly, shaped by policies, competitors, and economic shifts that remain unpredictable.

Lucid Motors Delivers Record Quarter as Federal EV Tax Credit Expires