A Little Good News for Lucid Investors

Key Points

• The $7,500 federal EV tax credit goes away at the end of September.

• Lucid will offer a $7,500 lease discount on the Gravity SUV during Q4.

• Even so, the electric vehicle maker did lower its production forecast.

• 10 stocks we like better than Lucid Group ›

Lucid Group (NASDAQ: LCID) has slowly but surely gained traction in the U.S. electric vehicle (EV) market and has momentum from six consecutive quarters of record-breaking deliveries. But it hasn't been an entirely smooth ride in 2025, with disappointing second-quarter results and slower-than-targeted production of its highly anticipated Gravity electric SUV.

The good news for investors is that Lucid is taking it upon itself to offset the loss of the $7,500 U.S. federal EV tax credit. Let's dive in.

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When one door closes...

In an attempt to keep the momentum it's gained with deliveries, Lucid is offering a $7,500 lease discount on the Gravity SUV during the fourth quarter to help offset the loss of the federal tax credit that expires at the end of September. It specifically applies to lessees who place an order by the end of September and take delivery between Oct. 1 and the end of 2025.

It's simply a way for Lucid to help out people who were banking on the federal tax credit but weren't able to take delivery of a Gravity by the end of September. It's likely a bigger deal than investors realize, because the U.S. EV market is going to be bumpy for the remainder of the year.

Remember that due to the tax credit ending at the end of September, it pulled ahead demand from people who were on the fence, and will likely leave an equally strong lull in demand once that pull-through is finished. New U.S. EV registrations rose 4.6% in June, compared to the prior year, but EV market share fell for the month and stayed flat for the first half of the year, according to S&P Global Mobility data. That means that right when Lucid gets production of the Gravity to desired levels, the EV market in the U.S. might be cooling off.

Right now, it appears that new hybrid offerings are giving consumers reason to delay going fully electric. "People who would have maybe gone fully electric are thinking hybrid is the easy choice because I have to make zero changes to my lifestyle and I'll save money," said Loren McDonald, chief analyst at EV data analytics firm Paren, according to Automotive News. "They're thinking, 'If I wait a couple of years, they're going to be way better.' "

The Gravity is crucial

While Lucid produces an excellent vehicle in its Air sedan, the Gravity is going to open up the doors to a wider audience. Lucid said that the Gravity market could be up to six times that of the Air sedan.

Image source: Lucid.

Understanding how important the Gravity is to Lucid in the near term and long term had investors a little anxious when it was reported that the Gravity only generated nine U.S. registrations by the end of June, six months after starting production.

While Lucid has said that the numbers aren't indicative of current sales, it's clear that production has not accelerated to the desired level, leaving the company to take what few production vehicles it has to use for test drives, showrooms, and employees. Furthering that sentiment is that Lucid cut its 2025 production outlook from the original 20,000 to a range of 18,000 to 20,000 vehicles.

What it all means

This is just another signal of how crucial the Gravity's success is to Lucid, and it helping consumers take advantage of a tax credit they were banking on is good business for the automaker. It also sets the Gravity up for a significant increase in deliveries during the back half of the year, which would continue the company's streak of record-breaking quarters of deliveries.

Lucid has momentum, and this is a little good news for investors that the momentum should continue going forward, even if the rest of the U.S. EV industry is in for a bumpy ride. But remember, young EV start-ups are high-risk and high-reward, and should remain a small position in any portfolio.

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Daniel Miller has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.