Beyond the letter sent to staff, Lucid shared some details about the upcoming layoffs in a regulatory filing, the most notable of which is that it will eat $24 million to $30 million as a result of its restructuring due to expenses like severance pay for laid-off workers. Executives aren’t immune from these cutoffs nor are contractors. Assuming everything goes according to plan, the entire debacle will be wrapped up by the end of the company’s second quarter.
The move isn’t surprising in light of Lucid’s February 2023 announcement that it needs to reduce its spending. The company was hit by a sharp drop in demand for its luxury EV in recent months, and it entered the new year in a weak position amid the wider economic uncertainty many face in our largely post-pandemic days.
The news came only a few weeks after the company’s biggest competitor, Tesla, announced sharp price cuts that made its already popular EVs even more attractive to consumers. The automotive market was hit particularly hard by the supply chain disruption that occurred during the height of the pandemic, leaving some new cars benched while used car prices climbed and manufacturers made hard compromises in the name of getting units out the door.
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