Porsche, Audi, General Motors, and other established automakers are trying to beat Tesla with zippy new electric vehicles, but the first real competition from an upstart could come from Lucid Motors, a company run by a former Tesla Model S chief engineer.
Peter Rawlinson, CEO of Lucid, follows former boss Elon Musk’s playbook when it comes to production, some tech, dealers and service. With charging stations for electric vehicles, automated driving systems and advertising, however, there is a different approach.
Here’s a comparison between Lucid, who announced plans to go public through a SPAC deal last week, and Tesla:
Unlike some newer electric vehicle makers, Lucid plans to manufacture all of its vehicles in-house, as Tesla does today.
Rawlinson believes “vertically integrating manufacturing is the way to go,” he said in an interview. The comments echoed remarks on a Lucid investor call last week.
“The simple fact is that to make sure the quality of our product is right, the manufacturing process is too precious and too critical to trust third parties,” he told investors. “We have to control our own destiny.”
Lucid is building a brand new “green field” auto plant in Arizona that costs billions of dollars. When Tesla began assembling its own vehicles, it took over the NUMMI plant, which once housed General Motors and Toyota Motor in California.
Lucid has signed a contract with LG Chem to supply battery cells, the most expensive part of an electric vehicle, for its standard battery packs for its Lucid Air sedan. The company announced that it would announce further suppliers in the future.
Tesla has already signed contracts with Panasonic, Samsung, LG and CATL for cell supply for both batteries and energy storage products including the Powerwall.
Lucid has announced that it will manufacture energy storage products, both home batteries and utility-scale devices. But Lucid won’t have the distraction and capital burden of running a solar business like Tesla has since it acquired SolarCity in Fall 2016.
Tesla’s history with battery supply partners could prove to be an advantage for Tesla in the short term.
Thanks to its longstanding partnership with Panasonic, Tesla has been able to take into account undisclosed prices and investments by the Japanese battery manufacturer. Together they own and operate a huge battery facility outside of Reno, Nevada.
Tesla makes the batteries for its vehicles on one side of the plant, while Panasonic makes cells for them on the other. However, Tesla announced to investors in September that the company had also started producing its own cells at a pilot facility in Fremont, California.
Lucid expects to produce more than 500,000 vehicles per year by 2030. Musk, who is known for formulating ambitious plans but failing to meet self-imposed deadlines, said Tesla will “likely” produce 20 million electric vehicles a year before 2030.
Last year, Tesla produced 509,737 electric vehicles. Deliveries were just under half a million despite a global slowdown in car sales due to the Covid pandemic.
Price and battery efficiency
Rawlinson expects the Lucid Air to be the catalyst for a number of future all-electric vehicles, including an SUV starting production in early 2023 and cheaper vehicles across the board.
Initially, Lucid plans to sell a high-end version of the Air, the Dream Edition, for $ 169,000.
For comparison, Tesla sells its Model S sedan for $ 79,990 for the base model and $ 139,990 for the top-of-the-line Plaid + version without adding Tesla’s premium software upgrade for $ 10,000.
By 2022, Lucid is expected to offer a version of the Air starting at $ 77,400, which would compete directly with several Tesla models. Prices exclude federal tax credits up to $ 7,500 in value available to Lucid customers but not Tesla buyers today.
It is currently unclear how low Lucid prices could be after the first two vehicles hit the market.
Rawlinson said the company’s next planned vehicle platform will lay the foundation for lower-priced models in the $ 40,000 to $ 45,000 range. But he’s not sure if the company will ever sell a vehicle for around $ 25,000, which Musk Tesla says is intending.
“Are we actually making a $ 25,000 car in the longer and fuller timeframe like Tesla plans to do with its Model 2?” Rawlinson said. “I think we as a company are probably seven or eight years away from even thinking about something like this. It’s a big undertaking.”
According to Rawlinson, Lucid has industry-leading battery technology for its vehicles. Its main measure is the efficiency of Lucid’s batteries in miles per kilowatt hour driven.
Lucid’s vehicles can travel more than 4.5 miles per kWh while Tesla’s Model S Long Range is greater than 4, says Lucid.
Charging the electric vehicle
According to Rawlinson, Lucid has no plans to build and operate its own charging system like Tesla did with its compressors. “Do we want the capital load of a fast-charging network? No, we can deal with it. We can save money here,” he said.
Tesla Supercharger Station
CNBC | Andrew Evers
Instead of building its own vehicle charging infrastructure, Lucid has partnered with Electrify America, which will have a total of 800 charging stations with around 3,500 chargers by the end of this year.
According to its website, Tesla currently operates more than 20,000 compressors worldwide.
Lucid, like Tesla, says it will offer customers home chargers.
When it comes to the development of driverless vehicle technology, Elon Musk has called lidar, or light range and detection sensors, a “fool’s hunt”. The sensors work with pulsed lasers to create something like a live 3D map of the vehicle’s surroundings, which can be read by on-board computer systems.
Many autonomous systems engineers believe that lidar is critical to making cars truly driverless. Instead of lidar, Tesla’s driver assistance systems and long-awaited self-driving capabilities rely on a variety of other cameras and sensors on board, including radar. Rawlinson believes the choice is a mistake.
“Do we think lidar should be part of the (autonomous vehicle) sensor suite? Yes we do,” Rawlinson said.
Lucid has announced that the Air sedan, which has been postponed from this spring to the second half of this year, will use lidar in its sensor suite for advanced driver assistance systems. The company expects the technology to “set a new benchmark” for the industry.
Tesla is today selling a high-quality, advanced, automated driving system for its vehicles for $ 10,000. There are plans to introduce a subscription option as well. While it is being marketed as “Full Self Driving”, the system functions do not allow truly driverless, hands-free and unsupervised driving.
Instead, FSD enables features that go beyond Tesla’s standard autopilot package. This includes intelligent navigation, automatic lane change, and intelligent summoning. With Smart Summon, a driver can call his car from his parking lot with his mobile phone like a remote control.
Tesla vehicles lack a robust driver monitoring system that can detect whether a driver is using their systems responsibly.
Lucid has promised to include a driver monitoring system in its vehicles that ensures that drivers are using their advanced, automated driving systems as prescribed, paying attention to the road and their surroundings, and are able to steer manually at all times.
Advertising and sales
Tesla has grown into one of the most famous automobile brands in the world without using traditional advertising. It has instead generated hype and attention through bubbly events, nontraditional social media engagement, Tesla online forums and owner clubs, and near constant engagement from Musk himself to fans and shareholders. For example, Musk has built a fan base of around 50 million people on Twitter.
In contrast, Lucid ran a national airborne television campaign from December 25th through the end of January to raise awareness of the company and the vehicle. Rawlinson said such a campaign wasn’t necessarily part of Lucid’s plans until the coronavirus pandemic last year forced the company to cancel several events.
Interior of the Lucid Air show car, which is expected to be produced from 2021.
“I thought, damn it, we have to because we couldn’t get the word out,” Rawlinson said. “So, we had a little foray, and I think that was pretty positive. So I’m not ruling that out just because Tesla isn’t.”
Lucid is also looking into Tesla’s direct sales and service models for consumers rather than selling through traditional franchise dealers.
Lucid has already opened six retail locations in California and Florida. By the end of this year, 20 retail locations and service centers are to be operated in North America and the vehicles are to be sold online. Tesla has about 160 retail locations in the United States, according to its website.