Luxury electric vehicle maker, Lucid (LCID), experienced a significant drop in its stock by over 8% following the release of its disappointing Q3 financial results. The company reported a sales miss and announced a reduction in its production forecast, as demand for its high-priced vehicles slows down.

Lucid now expects to produce 8,000 to 8,500 vehicles, revising its previous guidance of over 10,000, in order to align more prudently with deliveries. Throughout Q3, Lucid delivered 1,457 vehicles and produced 1,550 vehicles, bringing the total production for the period to approximately 6,000. This latest forecast also marks a downward revision from the initial projection of producing 12,000 vehicles by 2023.

The Q3 revenue for Lucid amounted to $137.8 million, falling short of the $177 million anticipated by Wall Street analysts, according to Bloomberg. However, the company reported an adjusted loss per share of $0.28 and an adjusted EBITDA loss of $624.1 million, which were slightly better than consensus estimates.

To boost demand, Lucid had to implement significant price cuts, as the company's flagship luxury sedan, the Air, does not qualify for federal EV tax credits. Last week, Lucid reduced the prices of its Air Touring, Air Pure, and Air Grand Touring models by several thousand dollars.

Despite the disappointing financial results, Lucid announced that its highly anticipated electric SUV, the Gravity, is on track for a reveal at the upcoming LA Auto Show. Production of the Gravity is scheduled for late 2024.

Lucid CEO, Peter Rawlinson, expressed confidence in the company but acknowledged the challenging macroeconomic environment. He mentioned that Lucid successfully launched cheaper versions of the Lucid Air model, increased production in its Phase 2 factory in Arizona, and inaugurated its first plant in Saudi Arabia.

However, CFRA analyst Garrett Nelson expressed concern over Lucid's performance, stating that the production cut indicates "weak demand" for their vehicles and selling cars at a loss is not improving the situation. Nelson reiterated his Sell rating and lowered his price target for Lucid from $4 to $2.

Despite the company's declining stock and falling average selling prices, Rawlinson indicated that he does not believe drastic measures are necessary at this point. He mentioned that the company is assessing various aspects of its operations, such as production efficiency, working capital, and inventory management, while striving to improve delivery numbers.

Overall, Lucid faces challenges as it grapples with lower-than-expected sales, a reduction in production forecasts, and the need to stimulate demand through price cuts. The forthcoming debut of the Gravity SUV at the LA Auto Show may provide a much-needed boost for the company and its future prospects.