Last week, Lucid Motors (NASDAQ: LCID) announced that it had entered into a partnership agreement with NeueHouse, a company that offers private offices as well as collaborative workspace, meeting and event spaces. The partnership officially began on Feb. 23, 2024, at NeueHouse’s Madison Square 10×10 House Party. The American manufacturer of luxury electric vehicles saw its shares drop by 5% following the announcement, which may indicate rising concern among its investors.
Lucid’s first car, Lucid Air, is a state-of-the-art luxury sedan with a design inspired by California.
According to the company’s official press release, the move to partner with NeueHouse reflected a shared belief that progressing sustainably required inspiration and collaboration from diverse creative minds, in addition to technological advancements. NeueHouse will provide a unique take, integrating cultural events, iconic buildings and hospitality to foster inspiration as well as productivity.
For NeueHouse, this partnership will facilitate the advancement of its mission to promote an environment where groundbreaking innovations are brought about by cross-disciplinary creativity. The company has locations in California and New York.
Despite this positive message, Lucid investors don’t seem to be convinced. The volatility observed last week may be attributed partly to a messaging disconnect. Particularly, coworking space demographics show that mostly young people use these spaces. Data from one report showed that 43% of members of coworking spaces were aged 30 and below.
This doesn’t align with buyers of Lucid vehicles, as one survey determined that most buyers older than the aforementioned age.
Additionally, partnering with a coworking space seems a bit odd, especially if one considers that the company’s lowest-cost model’s starting price is just about $70,000. As of 2022, the real median household income in the United States stood at $74,580.
It doesn’t help that the electric-vehicle sector is in a sort of slump at the moment. Tesla, the industry’s pioneer, saw its stocks drop by almost 4% last week. Tesla’s stock is, according to CNN Business, the worst performing in the S&P 500. Analysts expect Tesla’s stock to fall further, which may seem like a win for Lucid. However, high borrowing costs and increasing inflation seems to have limited demand across the board.
Despite this, all isn’t lost for Lucid. The new partnership comprises six programming activations at NeueHouse properties in Los Angeles and New York, including an event at Venice Beach that will feature editors, artists and designers on topics ranging from sustainability, beauty and design.
This may open Lucid up to new investors while also helping extend its consumer reach across the country.
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