Electric vehicle maker, Lucid, cut prices of its Air luxury sedans by as much as $12,400. The cuts are part of an ongoing offer amid rising competition in the U.S. EV industry and a price war sparked by Tesla.
The Air Pure’s price decreased by $5,000 to $82,400 from $87,400, and the more potent Touring and Grand Touring versions were discounted by $12,400 to $95,000 and $125,600, respectively. Lucid added that the offer would be available while supplies last.
Tesla’s Model S and Model S Plaid, which directly competes with the Air, is now priced at $88,490 and $108,490, down from $104,990 and $135,990 at the start of the year.
The auto industry was severely impacted by COVID-19-related supply chain constraints and rising raw material prices more than a year ago, forcing Lucid, which is majority owned by Saudi Arabia’s Public Investment Fund, and its competitors to boost their vehicle prices.
However, consumer demand has been muted by rising interest rates intended to combat inflation and worries of a recession, leading market leader Tesla to lower prices this year. This has also caused repercussions throughout the industry, making it challenging for cash-strapped startups like Lucid to gain market share when major automakers debut EVs against them.
The $7,500 federal tax credit provided by the Inflation Reduction Act helps certain less costly models in luring buyers, but more expensive vehicles, like Lucid’s Air, are ineligible.
After announcing a decline in output from April to June due to supply-chain issues on August 7, Lucid is projected to report deepening losses in its second-quarter earnings.