Tesla wannabe Lucid Motors has reached the stock market. Now comes the hard part.
Lucid made its trading debut Monday following the closure on Friday of its merger with special-purpose acquisition company Churchill Capital IV. The stock rose 10% to almost $27 in morning trading, giving the company a market value of roughly $43 billion based on a pro forma share count.
That is an extraordinary number for a company that has yet to sell anything, but it is much less than it would be using Churchill Capital IV’s $49 share price when the merger was announced on Feb 22. The hotly anticipated deal coincided with peak SPAC fervor. SPAC stocks have shed roughly a quarter of their value since their late February top, according to an index compiled by IPOX.
Lucid is closer to selling vehicles than the other electric-vehicle startups that have merged with SPACs. It is also the one that most closely resembles Tesla . Lucid Chief Executive Peter Rawlinson led the engineering team on Tesla’s Model S and is largely following the Elon Musk playbook of forging a new car brand by developing as technologically advanced an electric vehicle as possible. Lucid’s flagship first vehicle, the Lucid Air, with a starting price of $77,400 before purchase subsidies, will start commercial production in the coming months.
The resemblance to Tesla explains the hype around Lucid. Mr. Rawlinson thinks Tesla’s $620 billion market value is a function of the market-leading efficiency of its electric powertrains, which give the Model S a range of more than 4 miles per kilowatt-hour of battery power—the electric equivalent of miles a gallon. None of the first-generation electric vehicles from traditional luxury car makers such as Jaguar and Audi comes close, but the Lucid Air will offer a range of more than 4.5 miles per kilowatt-hour. Mr. Rawlinson says the most dominant factors are the efficiency of its electric motor, power electronics and coding.