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Crazy, they barely have a product. This is Nikola 2.0.

by zed88 6y ago

wcarron 6y ago
Lucid supplies the batteries for Formula E, and has for a few years, and I believe they recently resigned a contract to be the continued battery supplier for FE.
- zed88 6y ago
  Nikola had contracts too, with the likes of GM.
  - sokoloff 6y ago
    Nikola’s contract with GM was to buy from GM.
    - zed88 6y ago
      It is still a contract of some repute with 11% stake. Do you think GM would sell to just any other startup with no history, if it wasn't for the hype??
      - sokoloff 6y ago
        The 11% was an additional sweetener given to GM to induce the partnership, not money GM was investing in Nikola. Would I be willing to take some shine from an EV company willing to give me an approximately $2B (at the time) stake in their company, pay me around $700M of my own costs, and buy vehicles from me at a cost-plus arrangement? Shall I use my pen or yours? https://www.marketwatch.com/story/nikola-stock-drops-as-gm-deal-is-now-nothing-to-write-home-about-11606754461 https://www.marketwatch.com/story/nikola-stock-drops-as-gm-d... Disclaimer: I’ve been quite short $NKLA for a while, quite profitably; I still am.
        deleted 6y ago
        [deleted]
- ramenmeal 6y ago
  That doesn't sound like a $24B business.
  - wcarron 6y ago
    Maybe not, but they are clearly doing much more than just that, as a cursory google search (and the article) tells us.
  - onion2k 6y ago
    A company that is successfully making high-performance vehicle batteries only being valued at $24bn a decade before laws force the electrification of all the cars in the US and Europe seems really undervalued to me.
xiphias2 6y ago
It's easier to create a luxury car, just how Tesla started, so at least they have a chance to come out with the $170k product that looks great. I can imagine people buying it just so that they can be different from Tesla. Nicola wanted to compete in high volume battery manufacturing, which can't be done without a long ramp-up time.
- zed88 6y ago
  It's easy to create a prototype, the true test of any manufacturer is it's ability to roll these from the factories at scale. How many have they rolled yet?
  - root_axis 6y ago
    I think this is a greatly underappreciated point. Tesla is the picture of success these days but people forget things were looking quite grim from a production perspective not too long ago, and even now, Tesla's rush to scale has earned their cars a reputation for factory defects. Success is not a given even with a compelling prototype.
  - xiphias2 6y ago
    Why would they need scale for a $170k car? I don’t think there are many buyers in that range. I don’t agree with the $24B valuation, I just think that they have at least a chance to sell real cars, unlike Nikola that had a bad strategy from the start.
- heavyset_go 6y ago
  Many Tesla fans are willing to turn a blind eye to defects that you typically wouldn't find in other luxury cars. I don't think Lucid Motors' fan base is that dedicated and forgiving.
  - rsj_hn 6y ago
    If they get a fan base, then by definition that base is going to be willing to turn a blind eye to some defects because they love some other aspect of the car. For Tesla, people loved the acceleration, handling, and interior styling, and so they were willing to forgive some of the build quality issues like gaps between the door and the body. The question is whether Lucid can deliver some unique experience that customers value, and if so, then they too will be forgiven for their own gaps.
cepth 6y ago
You’d be paying for earnings several years out, for sure. But I think it’s hardly fair to compare to Nikola. Trevor Milton’s experience prior to starting Nikola was selling home security systems. Lucid’s leadership team features various Tesla, Audi, Ford, VW, etc. veterans. (See page 9: https://www.lucidmotors.com/files/lucid-investor-deck-february-2021.pdf https://www.lucidmotors.com/files/lucid-investor-deck-februa...) Lucid has finished building a factory that can produce roughly 30k cars per year, expandable to 400k. They’ve given rides in their launch vehicle to various auto journalists (https://youtu.be/gqSN2QNgO5k https://youtu.be/gqSN2QNgO5k). Their battery pack technology is a component of the Formula E drivetrain system (https://lucidmotors.com/media-room/atieva-powers-season-6-formula-e-spec-battery-pack-its-own-design/ https://lucidmotors.com/media-room/atieva-powers-season-6-fo...). This isn’t a “Nikola rolling a non functional truck down a hill” situation. They have a working product. The car could suck, the company could be overvalued. But I think hard to compare Nikola to Lucid. EDIT: I should also add for comparison, that at the time that Tesla IPOed in 2010, it was a 1.7B market cap company. Only ~2450 Roadsters (their only car at the time) would be sold in total. By November 29, 2010 Tesla had not yet sold 1400 cars (https://www.tesla.com/blog/race-champions-2010-motorsport-goes-electric-roc-buildup https://www.tesla.com/blog/race-champions-2010-motorsport-go...). Tesla's Fremont factory was opened in October 2010. In other words, when the company went public on June 29th, 2010 you would have been buying into a car company without a factory. The first Model S wasn't delivered until June 2012 (https://www.tesla.com/blog/tesla-motors-begin-customer-deliveries-model-s-june-22nd https://www.tesla.com/blog/tesla-motors-begin-customer-deliv...). Not to say that Lucid will or won't ever reach Tesla's heights, but assigning a 12B valuation to the company isn't loony. The SPAC price though is a different story. EDIT 2: There are some fun short videos of Lucid CEO Peter Rawlinson in the workshop from his Tesla days (https://www.youtube.com/watch?v=TrbOLHW8Pec https://www.youtube.com/watch?v=TrbOLHW8Pec, https://www.youtube.com/watch?v=8YxHp2ot61Y https://www.youtube.com/watch?v=8YxHp2ot61Y, https://www.youtube.com/watch?v=NGKqPYvtqXE https://www.youtube.com/watch?v=NGKqPYvtqXE). It's pretty awe inspiring to see where Tesla and the global EV industry as a whole was in 2011 vs today.
nostromo 6y ago
Going public early in a company’s life used to be pretty normal. Only in recent decades has it become the norm to wait to go public until late in a company’s growth. I think going public early is better. VC’s and insiders have been capturing the lion’s share of early-stage growth returns. If companies go public earlier, more of that growth will be accessible to more investors.
- trimbo 6y ago
  A $24bn public valuation without a product for sale has to be off the charts as "going public early", though, right? Amazon raised, what, $50M or $100M in its IPO (and is what I'd consider an early one)?
  - nostromo 6y ago
    Pets.com went public the year after incorporating. The year after that they liquidated. (Granted... those were crazy times we probably don’t need to replicate.)
    - trimbo 6y ago
      At least I got this sock puppet dog out of it (Yes, for real, I have one)
  - molyss 6y ago
    you mean versus having a product that loses money ? Uber was losing between $1B and $5B a quarter when they IPO'd. In the last quarter of 2020, Uber lost close to $1B, and they're still valued at $108B, with no real long term plan for survivability. The way I see it, risks include legislative changes WRT driver status, bad press, self driving cars, a post pandemic world where more people own a car, and less people are in cities. And we're talking about a company that is primarily marketing and software, where the wind can change very quickly, and assets are mostly intangible and untransferable. car manufacturing is much harder to get into, so having a factory and an almost-complete design is already a huge milestone. Obviously, they'll need to sell _some_ cars, but they could even make money if they were to sell cars at a loss, through carbon credits.
smilekzs 6y ago
I live close to their corporate office and can easly spot test mules running around in almost no camouflage.
impulser_ 6y ago
Comparing Lucid to Nikola is stupid. Lucid is nothing like Nikola. Yes, you could argue a 24b valuation is too expensive. But it basic supply and demand. You have a limited amount of shares of a very hyped up company in a very hyped up industry. Of course valuations are going to be expensive lol. Valuations only matter if you are selling today or tomorrow, not 10-20 years down the line.

Crazy, they barely have a product. This is Nikola 2.0.

by zed88 6y ago

Crazy, they barely have a product. This is Nikola 2.0.

Lucid supplies the batteries for Formula E, and has for a few years, and I believe they recently resigned a contract to be the continued battery supplier for FE.

zed88 6y ago
Nikola had contracts too, with the likes of GM.
- sokoloff 6y ago
  Nikola’s contract with GM was to buy from GM.
  - zed88 6y ago
    It is still a contract of some repute with 11% stake. Do you think GM would sell to just any other startup with no history, if it wasn't for the hype??
    - sokoloff 6y ago
      The 11% was an additional sweetener given to GM to induce the partnership, not money GM was investing in Nikola. Would I be willing to take some shine from an EV company willing to give me an approximately $2B (at the time) stake in their company, pay me around $700M of my own costs, and buy vehicles from me at a cost-plus arrangement? Shall I use my pen or yours? https://www.marketwatch.com/story/nikola-stock-drops-as-gm-deal-is-now-nothing-to-write-home-about-11606754461 https://www.marketwatch.com/story/nikola-stock-drops-as-gm-d... Disclaimer: I’ve been quite short $NKLA for a while, quite profitably; I still am.
      - deleted 6y ago
        [deleted]
ramenmeal 6y ago
That doesn't sound like a $24B business.
- wcarron 6y ago
  Maybe not, but they are clearly doing much more than just that, as a cursory google search (and the article) tells us.
- onion2k 6y ago
  A company that is successfully making high-performance vehicle batteries only being valued at $24bn a decade before laws force the electrification of all the cars in the US and Europe seems really undervalued to me.

xiphias2 6y ago

It's easier to create a luxury car, just how Tesla started, so at least they have a chance to come out with the $170k product that looks great. I can imagine people buying it just so that they can be different from Tesla. Nicola wanted to compete in high volume battery manufacturing, which can't be done without a long ramp-up time.

zed88 6y ago
It's easy to create a prototype, the true test of any manufacturer is it's ability to roll these from the factories at scale. How many have they rolled yet?
- root_axis 6y ago
  I think this is a greatly underappreciated point. Tesla is the picture of success these days but people forget things were looking quite grim from a production perspective not too long ago, and even now, Tesla's rush to scale has earned their cars a reputation for factory defects. Success is not a given even with a compelling prototype.
- xiphias2 6y ago
  Why would they need scale for a $170k car? I don’t think there are many buyers in that range. I don’t agree with the $24B valuation, I just think that they have at least a chance to sell real cars, unlike Nikola that had a bad strategy from the start.
heavyset_go 6y ago
Many Tesla fans are willing to turn a blind eye to defects that you typically wouldn't find in other luxury cars. I don't think Lucid Motors' fan base is that dedicated and forgiving.
- rsj_hn 6y ago
  If they get a fan base, then by definition that base is going to be willing to turn a blind eye to some defects because they love some other aspect of the car. For Tesla, people loved the acceleration, handling, and interior styling, and so they were willing to forgive some of the build quality issues like gaps between the door and the body. The question is whether Lucid can deliver some unique experience that customers value, and if so, then they too will be forgiven for their own gaps.

cepth 6y ago

You’d be paying for earnings several years out, for sure. But I think it’s hardly fair to compare to Nikola. Trevor Milton’s experience prior to starting Nikola was selling home security systems. Lucid’s leadership team features various Tesla, Audi, Ford, VW, etc. veterans. (See page 9: https://www.lucidmotors.com/files/lucid-investor-deck-february-2021.pdf https://www.lucidmotors.com/files/lucid-investor-deck-februa...) Lucid has finished building a factory that can produce roughly 30k cars per year, expandable to 400k. They’ve given rides in their launch vehicle to various auto journalists (https://youtu.be/gqSN2QNgO5k https://youtu.be/gqSN2QNgO5k). Their battery pack technology is a component of the Formula E drivetrain system (https://lucidmotors.com/media-room/atieva-powers-season-6-formula-e-spec-battery-pack-its-own-design/ https://lucidmotors.com/media-room/atieva-powers-season-6-fo...). This isn’t a “Nikola rolling a non functional truck down a hill” situation. They have a working product. The car could suck, the company could be overvalued. But I think hard to compare Nikola to Lucid. EDIT: I should also add for comparison, that at the time that Tesla IPOed in 2010, it was a 1.7B market cap company. Only ~2450 Roadsters (their only car at the time) would be sold in total. By November 29, 2010 Tesla had not yet sold 1400 cars (https://www.tesla.com/blog/race-champions-2010-motorsport-goes-electric-roc-buildup https://www.tesla.com/blog/race-champions-2010-motorsport-go...). Tesla's Fremont factory was opened in October 2010. In other words, when the company went public on June 29th, 2010 you would have been buying into a car company without a factory. The first Model S wasn't delivered until June 2012 (https://www.tesla.com/blog/tesla-motors-begin-customer-deliveries-model-s-june-22nd https://www.tesla.com/blog/tesla-motors-begin-customer-deliv...). Not to say that Lucid will or won't ever reach Tesla's heights, but assigning a 12B valuation to the company isn't loony. The SPAC price though is a different story. EDIT 2: There are some fun short videos of Lucid CEO Peter Rawlinson in the workshop from his Tesla days (https://www.youtube.com/watch?v=TrbOLHW8Pec https://www.youtube.com/watch?v=TrbOLHW8Pec, https://www.youtube.com/watch?v=8YxHp2ot61Y https://www.youtube.com/watch?v=8YxHp2ot61Y, https://www.youtube.com/watch?v=NGKqPYvtqXE https://www.youtube.com/watch?v=NGKqPYvtqXE). It's pretty awe inspiring to see where Tesla and the global EV industry as a whole was in 2011 vs today.

nostromo 6y ago

Going public early in a company’s life used to be pretty normal. Only in recent decades has it become the norm to wait to go public until late in a company’s growth. I think going public early is better. VC’s and insiders have been capturing the lion’s share of early-stage growth returns. If companies go public earlier, more of that growth will be accessible to more investors.

trimbo 6y ago
A $24bn public valuation without a product for sale has to be off the charts as "going public early", though, right? Amazon raised, what, $50M or $100M in its IPO (and is what I'd consider an early one)?
- nostromo 6y ago
  Pets.com went public the year after incorporating. The year after that they liquidated. (Granted... those were crazy times we probably don’t need to replicate.)
  - trimbo 6y ago
    At least I got this sock puppet dog out of it (Yes, for real, I have one)
- molyss 6y ago
  you mean versus having a product that loses money ? Uber was losing between $1B and $5B a quarter when they IPO'd. In the last quarter of 2020, Uber lost close to $1B, and they're still valued at $108B, with no real long term plan for survivability. The way I see it, risks include legislative changes WRT driver status, bad press, self driving cars, a post pandemic world where more people own a car, and less people are in cities. And we're talking about a company that is primarily marketing and software, where the wind can change very quickly, and assets are mostly intangible and untransferable. car manufacturing is much harder to get into, so having a factory and an almost-complete design is already a huge milestone. Obviously, they'll need to sell _some_ cars, but they could even make money if they were to sell cars at a loss, through carbon credits.

smilekzs 6y ago

I live close to their corporate office and can easly spot test mules running around in almost no camouflage.

impulser_ 6y ago

Comparing Lucid to Nikola is stupid. Lucid is nothing like Nikola. Yes, you could argue a 24b valuation is too expensive. But it basic supply and demand. You have a limited amount of shares of a very hyped up company in a very hyped up industry. Of course valuations are going to be expensive lol. Valuations only matter if you are selling today or tomorrow, not 10-20 years down the line.