(Reuters) – Electric vehicle maker Lucid Group said it expects to report a bigger-than-expected loss for the third quarter and announced a public offering of more than 262 million shares, sending its shares down 12 in aftermarket trading on Wednesday % decreased.
In addition, the Saudi Public Investment Fund, a majority shareholder of Lucid, said it would buy 374.7 million shares of the company. The fund expects to retain a stake of almost 59% in Lucid.
The sovereign wealth fund’s latest investment underlines the importance of this lifeline for Lucid in the race for survival among struggling EV startups.
The electric car maker plans to use the proceeds from PIF’s offering and private placement to fund its capital expenditures and other corporate financing needs.
PIF had said in August it would inject up to $1.5 billion in cash through its subsidiary, Ayar Third Investment, as Lucid looks to ramp up production of a new SUV.
The Saudi government, which retains a nearly 60% stake in Lucid, has invested billions in the company as part of the kingdom’s strategy to diversify its economy beyond the oil sector.
Lucid expects to report an operating loss of $765 million to $790 million for the quarter ended Sept. 30, compared with the average analyst estimate of a $751.65 million loss, according to data compiled by LSEG.
The company will report its third-quarter results on November 7.
Demand for electric vehicles in the United States has weakened due to high interest rates and the availability of cheaper hybrid alternatives.
EV companies such as Tesla, Rivian and Lucid have lowered their prices and offered incentives such as cheaper financing options to acquire customers.
(Reporting by Shivansh Tiwary in Bengaluru; Editing by Shreya Biswas)
