I was sitting down yesterday, having a juice with a co-founder of an EV startup (of sorts) and we turned to the topic of executives. Who is the best person to lead a startup car company? Is it a car designer? A gearhead? An engineer? A cold, serious businessperson? I don’t think there’s a definitive answer to this question, but whatever Lucid is doing hasn’t worked yet.
For this Morning Dump I’m going to recycle a now semi-famous TMD headline: “I’m Not Convinced Stellantis Can Stick The Landing.” Stellantis was still making money then, and their CFO was telling people that the second half of the year would be a big return to profits. I didn’t buy it, mostly because it didn’t make any sense. Two years later the executive team was gone and the company had to do a major reset, admitting to basically all the issues I pointed out in that article. Lucid is somehow both in better and worse shape than Stellantis, though I don’t think it’s quite fatal. If they’re lucky, they’ll be like the Knicks at the half last night, and we all know how that ended.
There are numerous threats out there, though, with President Trump admitting the USMCA is dead because America doesn’t need anything from Canada or Mexico. Cool. At least we know how the War in Iran will end; oh, wait, we don’t, which is another risk in the car market for non-EV makers. This is getting bleak, so at the very least let’s end with the good news that Ford is able to get aluminum from its supplier in New York.
Extremely Likable Lucid Engineer Is No Longer At Lucid
So, I’m sitting on the High Line in New York talking to this co-founder, whom I will not name but has a long history in the automotive industry. He’s not from the US and he was marveling at all the Fisker Oceans in New York. I was able to wow him with the Oceans of NYC game. He’s now playing it, meaning that there’s at least one exec trying to find Oceans in New York right now, which is amusing to me.
“Building cars is hard,” he said, remarking that he thought the Fiskers he was getting as Ubers were half-baked, but that he appreciated how difficult it was to build anything, let alone something as complex as a car. Between Thomas Ingenlath at Polestar and Henrik Fisker at various failed iterations of Fisker, car designers have a lousy track record as CEOs. Lucid started with an incredible engineer and built a car that, if you live in the United States at least, is still probably the best EV sedan. The company then went on to build one of the best three-row SUVs of any kind on the planet, though even that car worried David, who was among the first to drive it:
I’m a former engineer, I have a number of friends who work at Lucid, and my conversation with CEO Peter Rawlinson was nothing short of epic. Lucid is an organization run by the best kind of nerds obsessed with maximizing efficiency, and that’s usually a good thing.
But with the Lucid Gravity, I have a suspicion that engineers won most of the arguments with designers, and I have always been firmly in the camp that thinks designers should tell engineers what to do, thereby compelling them to come up with interesting technical solutions. I don’t think it should be the other way around, because design is simply too important, especially in this price class.
I went to an investor day held by the company, and Lucid execs made it clear that they had a grasp on many of the problems. Sitting on a huge amount of cash from the Saudi Public Investment Fund, the company has more runway to figure out its challenges than most, even as it loses big money on every car. It’s also going to make vehicles for Uber, assuming the robotaxi market is something people will care about. The Lucid Cosmos is going to be one of three vehicles on that platform. Like Rivian with the R2, Lucid thinks the under-$50k two-row crossover EV segment, so completely dominated by Tesla with the Model Y, is the place to be. Maybe? Honestly, the Comsos did look a little like it was still beholden to the extreme efficiency that is the company’s greatest achievement and its largest obstacle.
This is all to say that the company is still in a very long transition period to anything that doesn’t generate endless giant losses. I covered a lot of this at the end of Q1 when the company suspended its own production estimate and missed even the low expectations it had to clear:
With the Gravity out the door, Wall Street was looking for the company to make about $440 million and only lose the equivalent of about $2.64 per share. By those measures, Q1 was a big miss, with a loss per share of $3.46, and revenue of $282.5 million. Overall, the company lost $989,485,000, which rounds uncomfortably to $1 billion.
There’s more news, and it’s making people who watch the company a bit uncomfortable. Founder and original CEO Rawlinson stepped down last year, replaced temporarily by another guy, who has then been permanently replaced by new CEO Silvio Napoli. In what feels like a big moment for the company, Lucid announced the departure of Emad Dlala, one of the longest-tenured Lucid employees. As TechCrunch reports:
In a statement to TechCrunch, Lucid Motors confirmed Dlala’s departure and said the company is “transforming its organization to accelerate innovation and strengthen execution under CEO Silvio Napoli.”
As part of that transformation, Lucid Motors said that Vivek Attaluri, the company’s vice president of vehicle engineering, and Marc Solsona Palomar, its vice president of software, will now report directly to Napoli.
“Emad Dlala has elected to leave the company to pursue other opportunities. We thank Emad for his many contributions over the years and wish him continued success in his future endeavors. Lucid remains focused on streamlining our organization and processes to fully leverage the strength of our team and will communicate further actions soon,” the company said in a statement.
Dlala declined to comment.
I went to get a photo Dlala and I got the screenshot above, which just about says it all. Someone at Lucid wasted no time in getting rid of even the photo of the one exec that everyone seemed to like. People are not taking it well. I think a good representative is Out Of Spec‘s Kyle Conner, who wrote on X:
It’s fair to say that Lucid is now no longer the company we’ve known
Emad’s passion for the products and customers was unmatched – I’ve had multiple midnight calls with him discussing challenges and wins (not that he would *ever* complain to me about a video I made ????).
On one occasion I was lucky enough to join his recurring team breakfast gathering at HQ… it was refreshing to see how he led a talented group of engineers with openness, understanding, and high expectations.
It’s sad to see him go at such a critical time for the brand[.]
This is a super pivotal moment for the brand, I agree. The company has to show it can move in the right direction, it has to organize itself around a coherent vision, and it has to produce cars at a scale that keeps its Saudi investors from deciding to walk away. Is Napoli the guy? Some think so, and it’ll take guidance from someone who isn’t beholden to the design or the engineering teams to succeed in the market. They need someone who can be there at the right moment to glide past the defense and tip the ball into the hoop.
They need an OG, if you catch my drift.
Ok, So The USMCA Is Probably Dead
There’s a great delivery in the first act of the musical Hamilton when both Alexander Hamilton and Aaron Burr are seconds at someone else’s duel, foreshadowing the big event in Act II. Burr tries to get Hamilton to admit that duels are stupid and that nothing anyone said was worth dying over. Hamilton sort of agrees, and then goes on to explain all the issues at hand.
Burr, played perfectly by Leslie Odom, Jr., lets out a resigned “Ok, so we’re doing this…”
That’s how I feel about the President’s move to get rid of the United States-Mexico-Canada Agreement (USMCA). While I think most people have known that it’s probably going to end up with a trio of bilateral agreements that the next President is going to have to sort out, even as of this week people were still talking about how to fix USMCA. According to President Trump, via Bloomberg, the USMCA is as good as dead:
“I’m not looking to renew it,” Trump told reporters Wednesday at the White House. “Because to be honest with you, the United States does much better. We don’t need anything that Canada has, we don’t need anything that Mexico has, but they need everything that we have, and they have to treat us better.”
I do think America needs both Mexico and Canada, and it’s especially true that the automotive industry needs both countries. Hopefully, this is just going to be a negotiating tactic.
Chinese Consumers Aren’t Buying Gas Cars, Which Is Bad For American Companies
The conflict in Iran will end, eventually, I’m sure. Until then, the higher gas prices are collapsing the market in China, which is a place where American and other automakers still need customers.
Sales at General Motors’ main China joint venture, SAIC-GM, plunged for the second straight month in May on higher pump prices after growing in the first quarter on an uptick in demand for gasoline models.
China’s new-car volume continued to slide last month as oil prices stoked by the war in Iran coupled with a stagnating economy to impact overall demand.
Industrywide deliveries of new sedans, crossovers, SUVs and multipurpose vehicles fell 22 percent to 1.51 million in May, with gasoline models plunging 37 percent to below 559,000, according to the China Passenger Car Association.
Global brands, still deriving the bulk of their sales from internal combustion products, continued their retreat as domestic players with stronger electrified lineups better weathered the downturn.
Yeesh.
Ford Will Start Getting Aluminum From Its Supplier, Finally
The fires at Ford supplier Novelis were so bad that the company has only just started getting production together, probably costing the automaker billions of dollars. According to the Detroit Free Press, Novelis is finally back:
As Ford continues to push to add 50,000 extra units of trucks to its inventory to partly make up for the lost truck production after the first fire last year, Novelis in Oswego, New York, is finally back online.
In a statement on June 10, Novelis spokeswoman Julie Groover said Novelis restarted the hot mill at Novelis factory in Oswego on June 8 and it is once again operational after being idled since last September.
“Restarting the Oswego hot mill is an important step forward for our operations and, most importantly for our customers,” Steve Fisher, CEO of Novelis Inc., said in a statement. “We are deeply grateful for the flexibility and partnerships our customers have shown, as well as the extraordinary efforts of our employees, suppliers and industry peers who came together to support continuity of supply.”
If you’re Ford, this can’t happen fast enough.
What I’m Listening To While Writing TMD
It’s time for a posse cut!!!!! “Thank You New York Knicks.”
The Big Question
Can Lucid stick the landing?
Top photo: Lucid
“The conflict in Iran will end, eventually, I’m sure.”
…it will, but a new Middle East conflict will appear in its place, and a new Middle East conflict will appear in that one’s place once it ends, for as long as the United States exists. Born too early to deploy to the Middle East, born too late to deploy to the Middle East, born just in time deploy to the Middle East.
Unfortunately the powers that be demand it. They all have inordinate sums of money tied up in the military industrial complex, which is basically our entire economy outside of weird speculative tech bubbles at this stage. Capitalism went completely off the rails decades ago.
If the US isn’t liquefying people in that region the economy is in trouble, so we just never stop doing it…and on top of that there’s oil there, and everyone wants to be able to fill up their F250 Boss Hog editions on the cheap, so we’re just going to go ahead and take some of that while we’re there too.
This is all very dumb and very tragic, but this comment has gone on enough at this point. Cheeto Mussolini just said yesterday that he “loves the inflation” too, so everything is just going to keep getting worse. The annihilation of the middle class will continue until morale improves…and by morale I mean the bank accounts of the robber barons.
The construction and agricultural markets should probably remind POTUS where softwood lumber and potash primarily come from.
I dunno if Lucid can stick the landing, but I sure hope they do. Or at least that their tech lives on under another brand.
Yeah, saying we don’t need what Canada and Mexico have is just stupid. We’re all stronger together.
Something about tides and ships…
I am not familiar with Lucid, but they sound like the classic era of Citroën (just at a higher price point). I would love to have / drive one of their cars, but I assume they are out of reach.
Citroën failed and now is just a joke. Things not boding terribly well for Lucid then.
Easier to assume that T-Dump is lying every time he speaks or posts until verified. I’m not doing that work, and the data speak for themselves regarding his truthiness.
Until they get their UI/UX software functional, absolutely not. Everything I read from long term tests or owners of the Air has told me the engineering and hardware is absolutely incredible, but some design decisions were very strange, build quality is 2014 Tesla bad, and the software is genuinely buggy, unreliable and incomprehensible trash. I get that it’s difficult, but cmon, if you want to be a tech forward EV, make your tech work, or people will avoid you like the plague.
If they’re lucky, they’ll be like the Knicks at the half last night, and we all know how that ended.
Do we? I don’t get the impression there is much basketball enthusiasm here, although I watched every second of that game and am glad I did.
I don’t have many thoughts on Lucid, but that was one hell of a fourth quarter last night. I have been rooting for San Antonio (mostly because I think Wemby is a truly legendary player), but I can’t help but root for New York after that. I’m not sure the Knicks did anything special in the second half, but continuing to play with intensity despite getting absolutely smoked in the first half is impressive in itself.
I’m curious how many people watched that game until the end. I know a few people that turned it off at halftime or early in the fourth. I’m fortunate I had nothing better to do but watch all of it – that was one of the more fun endings I have seen in a long time.
I’m not a Knicks fan, but at this point, go Knicks!
The problem with sports references is it can be niche. I didn’t see the Knicks game, but from what I’ve read it was epic. On the other hand, I am planning to see the ‘Canes / Knights game tonight and expect game 5 to be as epic as the first 4. What happened in Game 3 is easily as big as last night in Basketball, but the NHL doesn’t have the fan base as the NBA.
(If you missed it, in a defensive struggle, a Knight player scored 4 goals in a row in the 4th period. Then in the 3rd period, the Canes scored 3 goals in under a minute and scored a goal that was reviewed where it seems like both teams had all their players stuffed in the goal at once. Then in the 2nd OT, on a simple dump in, the puck bounced off the end boards, hit the back of the Canes goalie and into the net in a very fluke goal. The other 3 games have been that level of chaotic too.)
I know that very well. I am a basketball fan but not a hockey fan, so I genuinely don’t know what is going on in the Stanley Cup finals.
I hope you are enjoying the Stanley Cup finals as much as I am enjoying the NBA finals.
(I’m sure there are also non-sports fans on this site who have no idea what either of us are talking about)
I’ve been eyeing lightly used Air’s and they are getting to the price point of consideration. But, I’m pretty sure they’re going to be gone in five years, so what’s the point?
Seems they’re still having significant software issues, too.
From Engineering Explained:
Lucid Is Buying My Car Back – More Problems!
I don’t think the human brain handles having $billions at the whim of the few, or the one. Astonishingly, usually a questionable brain before gets the shot.
Not everyone watches sportsball, Matt…
“Hopefully, this is just going to be a negotiating tactic.”
If you’ve payed any attention to this person for the past 40 years, you’d know that Pedo-Felon 45/47 is lazy, stupid, and a lousy negotiator.
Meanwhile this:
“I have a suspicion that engineers won most of the arguments with designers, and I have always been firmly in the camp that thinks designers should tell engineers what to do, thereby compelling them to come up with interesting technical solutions.”
Years ago I took architecture classes with a young-ish practicing architect. At one point he had us meet him at a house he had designed for a client and was winding up construction on.
I took a look at a few structural details – such as a wall coming down onto an arch but off center – and asked him how he kept the thing standing.
He said he called in an engineer and they just shoved in a few steel beams.
I found that, and the resulting unnecessary expense for what would have been very simple to arrange such that the load would come down thru bearing walls, to be the stupidest answer ever.
Form over function is how we ended up with buttonless car interiors and electronic door handles.
The Shart of the Deal!
Its pretty short sighted, because a stronger canada and mexico is better for the united states than to give up everything to China.
(Europe, plus other countries, raises its hand to speak)
I dunno, but used Lucid prices are getting pretty interesting!
“We don’t need anything that Canada has, we don’t need anything that Mexico has, but they need everything that we have, and they have to treat us better.”
Yes, I’m so sick of being mistreated by Canada and Mexico, lol. Clearly, they just need to literally bribe him. I hear he likes gold.
Is Lucid boned? Yup, they’re boned
Only thing that could save Lucid is a pivot to trucks since that is the only thing Americans buy.
No, Lucid needs to be able to make less expensive cars.
Making ones that work might be a better start.
“Man, this deal sucks. Who signed this stupid thing in the first place?” Uh, that would be you, Trump, you complete moron.
Not so different from “Man this Fed Chair sucks! I was shocked when he as appointed who would do that?” which would ALSO be Trump.
I think we’re all at a point that anything stated publicly by the President will be different by the following week.
Since he’s already decided that he’s not going to follow international agreements (made by him, himself), what would an agreement even meat to him?
Anyway, USMCA runs until 2036 (even if “cancelled”) – that’s at least two more US Presidential elections.
More importantly, what does an agreement the United States mean to the rest of the world at this point? 🙁
For the next two years, probably nothing.
I really hope that Lucid sticks the landing because they have the best EV drive train in the industry. They really need a Model Y moment or they are gone. If they do begin to fade away, I hope a good company buys their IP and can leverage their motors.
I still think the way to go for most of the EV industry to go is for a couple of companies to do the R&D and build the platforms and sell them to car companies to dress them us as they wish. I.e. Most manual Swiss watches are built on ETA and Valjoux movements (i.e. platforms) and most computers use off-the-shelf CPUs.
I had read that is what Lucid wanted to do early on, really be a supplier and not a car company.
They will not stick the landing, the Saudis will eventually get bored, turn off the money tap and Lucid will fade into oblivion.
(see LIV GOLF)
To be fair, LIV golf was a terrible idea from the start.
I have no who convinced the Saudis that professional golf desperately needed shorts, music, and contrived teams with stupid names & logos, but I don’t recall many rational people thinking LIV was a good idea at any point.
I’m not sure Lucid will survive over the long term, but as Lucid has made some genuinely good (but expensive) products, I don’t see why the Saudis would pull the plug quite as suddenly as they did with LIV.
LIV golf was a good idea, with
somea lot of dumb shit thrown in.Hell of a lot easier to start your own golf series than it is something like a competitor to the NFL or Formula 1.
Even with all the dumb shit, they were able to get some big names to switch, and the PGA (for a while) was nervous. Had they simply stuck closer to the PGA formula (with more money), who knows what would have happened.
Yup, see LIV Golf as an example.
Got jinxed on that one.
Also think we can change it to DED Golf now
Also, the LUCID thing was probably a hedge for the Saudi’s. Their entire economic existence is built on oil and if the world went all in EV, they’d be out of luck. This (in the grand scheme of things) small investment was an ante worth paying for to get dealt a hand in the EV game.
The Saudis have been playing numbers games with their oil reserve estimates for decades.
They know they need to plan beyond oil – and they have plenty of money and sunlight to make their plans work.
I’m not sure I could buy a car that is Chaired by MBS and owned by the Saudi government. This coming from a Tesla owner.