Photo: Lucid Motors
Back in February, EV automaker Lucid Motors revised its production goal down from 20,000 to around 12,000 - 14,000 vehicles for 2022, only to slash that number in half as of August. Granted, the supply chain issues have been a complete nightmare for the auto industry, and they’re not getting any better anytime soon. But some states aren’t making things any easier.
The state of Texas, in particular, has some rather strict laws that brands like Lucid say are anti-competitive and anti-consumer. And for that reason, the Newark, California-based automaker has recently filed a federal lawsuit against the state.
According to the case document, “Texas law allows vehicle manufacturers like Lucid to do everything that motor-vehicle dealers do—including selling motor vehicles to Texas consumers—with one single, narrow exception: selling new motor vehicles from an established and permanent physical location in the state.”
And that single exception is exactly what Lucid is trying to do with its direct sales and service model, which includes selling vehicles directly to customers online and at the brand’s studio locations.
Being the only dealer of its vehicles, the company says it has no intention of ever using a franchised independent dealership model since it would slow down operations and would be detrimental to both itself and its customers.
Moreover, the company uses “uniform and transparent prices” to sell its vehicles. Therefore its current model eliminates hidden fees, artificial price bumps, and even “pushy” behavior from dealers who are incentivized to sell extra add-ons or simply high volumes.
“Lucid has determined that the direct-sales model is the only viable way for it to bring its new vehicles to market. As a startup still building production capacity and consumer awareness, Lucid’s sales at this time are limited and would not support a network of independent franchised dealers,” the company also said.
According to an October statement, Lucid has managed to produce 2,282 vehicles in Q3 this year, which is more than triple its Q2 production and on track to meet its yearly goals of 6,000 to 7,000 vehicles.
According to the case document, “Texas law allows vehicle manufacturers like Lucid to do everything that motor-vehicle dealers do—including selling motor vehicles to Texas consumers—with one single, narrow exception: selling new motor vehicles from an established and permanent physical location in the state.”
And that single exception is exactly what Lucid is trying to do with its direct sales and service model, which includes selling vehicles directly to customers online and at the brand’s studio locations.
Being the only dealer of its vehicles, the company says it has no intention of ever using a franchised independent dealership model since it would slow down operations and would be detrimental to both itself and its customers.
Moreover, the company uses “uniform and transparent prices” to sell its vehicles. Therefore its current model eliminates hidden fees, artificial price bumps, and even “pushy” behavior from dealers who are incentivized to sell extra add-ons or simply high volumes.
“Lucid has determined that the direct-sales model is the only viable way for it to bring its new vehicles to market. As a startup still building production capacity and consumer awareness, Lucid’s sales at this time are limited and would not support a network of independent franchised dealers,” the company also said.
According to an October statement, Lucid has managed to produce 2,282 vehicles in Q3 this year, which is more than triple its Q2 production and on track to meet its yearly goals of 6,000 to 7,000 vehicles.
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