The U.S. electric vehicle manufacturer Lucid Group Inc (LCID.US) announced on Monday a new, significant round of layoffs and the elimination of its Chief Operating Officer position. This move is part of a broader effort to reduce costs and enhance operational efficiency, aiming to accelerate the path to profitability amidst a backdrop of slowing EV demand and heightened industry competition.
According to a filing with the U.S. Securities and Exchange Commission, the company plans to cut approximately 18% of its U.S. workforce. This reduction will affect full-time employees, contractors, and production line workers. The company anticipates this restructuring will result in a one-time cash charge of around $32 million but is expected to generate annual operational savings of approximately $158 million.
This marks at least the second major workforce reduction for the company this year. In February, it announced a global workforce reduction of about 12% to streamline its organizational structure and improve operational efficiency. At that time, the company stated that production staff at its Arizona factory would not be impacted. With a total workforce of around 9,000 employees as of the end of 2025, the combined effect of these two rounds of layoffs could affect close to 2,500 workers.
Following the announcement, the company's stock price fell by 3.5% during Monday's trading session. As of the previous week's close, the stock had declined nearly 49% year-to-date.
In recent years, the company has faced multiple challenges, including production ramp-up difficulties, supply chain volatility, and rising costs. Concurrently, shifts in tariff policies, intensifying price competition within the EV sector, and softening consumer demand have added pressure to its sales performance.
The company currently focuses on selling its premium electric sedan, the Air, and its SUV model, the Gravity. Last month, the new Chief Executive Officer, Silvio Napoli, initiated a comprehensive operational review and announced a suspension of full-year production guidance to reassess market demand and production plans.
The company stated that this latest round of layoffs is part of a comprehensive cost optimization program. The goal is to gradually steer the company toward a path of "profitability and positive cash flow" by streamlining the organization, optimizing operational expenditures, and adjusting production capacity planning.
As part of these adjustments, the company will also eliminate the second production shift at its Arizona factory. This shift was added late last year with the original intent of increasing output and accelerating vehicle deliveries.
Simultaneously, a significant management change has occurred. The company announced the elimination of the COO role, and the current COO and former interim CEO, Marc Winterhoff, has departed from the company.