Tesla Rival Lucid Motors Shares Tank Amid SEC Subpoena

Electric vehicle maker Lucid Motors (LCID) saw its share price drop over 15% in premarket trading on Monday as it revealed that it was subpoenaed by the Securities and Exchange Commission.

The SEC probe was disclosed in an 8-K regulatory filing on the company’s website, where Lucid said the agency requested “production of certain documents related to an investigation” last week.

Lucid continued in the filing by saying, “Although there is no assurance as to the scope or outcome of this matter, the investigation appears to concern the business combination between the company Churchill Capital Corp. and Atieva, Inc. and certain projections and statements."

Lucid raised $4.4 billion in a SPAC deal with Churchill Capital, which helped take the company public in July without offering the traditional public share offering process. The deal was announced in February, giving Lucid a valuation of $24 billion, Reuters reported.

Since going public, shares of Lucid have nearly doubled, CNN said.

Lucid, which is headed by Peter Rawlinson, a former Tesla engineer, is the latest EV maker to undergo scrutiny.

In September 2020, electric truck maker Nikola was faced with a report by short seller Hindenburg Research, which accused the company of “intricate fraud,” saying it was making inaccurate claims about the advancement of its products to further its placement in the market.

Nikola’s founder Trevor Milton resigned, and an internal investigation by the company later revealed that he had misled investors. He faces charges from the SEC and criminal charges, CNN reported.

Nikola is working to pay a $125 million fine levied by the SEC for Milton’s misleading claims to investors on social media, Reuters said.

Another truck maker, Lordstown Motors, was also up against a report from Hindenburg, which questioned the number of orders it has for its trucks, resulting in both its CEO and CFO resigning. It is being investigated by the SEC, according to Reuters.

Both Nikola and Lordstown went public through SPAC deals and were riding high on hefty share prices, which haven’t been able to recover. According to CNN, both their stock prices are down nearly 90% since highs recorded earlier this year.

Lucid produces the Air Dream EV, which was named MotorTrend Car of the Year in October. The automaker began delivering the first Air Dream vehicles in the same month.

As of Monday at 10:08 a.m. EST, shares of Lucid Motors were trading at $41.18, down $6.09, or 12.88%.