Lucid Group, Inc.

Ladies and gentlemen, thank you for standing by and welcome to the Lucid Group first quarter 2022 earnings conference call. Please be advised that today's conference is being recorded. Later, we will conduct a question and answer session. If you have a question, please press the star and one on your touchtone phone. I would now like to turn the conference over to your speaker for today, Maynard Um, Senior Director of Investor Relations. Please go ahead, sir.

Thank you and welcome to Lucid Group's first quarter 2022 earnings call. Joining me today are Peter Rawlinson, our CEO and CTO, and Sherry House, our CFO. Before handing the call over to Peter, let me remind you that some of the statements on this call, particularly those regarding the future financial performance of the company, production and delivery volumes, macroeconomic and industry trends, company initiatives, supply chain dynamics, expansion of our studios and manufacturing facilities, and other future events are based on the information that we have as of today and constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to numerous risks, uncertainties, and other factors that could cause actual results to differ from expectations, and we refer you to the cautionary language included in risk factors in our quarterly report on Form 10-Q for the quarter ended March 31, 2022, as well as other documents filed or to be filed with the SEC for a fuller discussion of such risks, uncertainties, and other factors. Forward-looking statements made during today's call speak only as of the time they are made, and we are under no obligation and expressly disclaim any obligation to update, alter, or otherwise revise any forward-looking statements, either as a result of new information, future events, or otherwise except as required by law. You are cautioned not to place undue reliance on these forward-looking statements. In addition, management will make reference to non-GAAP financial measures during this call. A discussion of why we use non-GAAP financial measures and information regarding reconciliation of our GAAP versus non-GAAP results is available in our earnings press release issued earlier this afternoon, as well as in the investor deck available on the investor relations section of our website at ir.lucidmotors.com. With that, I'd like to turn the call over to Lucid CEO and CTO, Peter Rawlinson. Peter, please go ahead.

Thank you, Maynard. In Q1, we delivered 360 vehicles to customers, nearly tripling the 125 cars delivered in Q4 of 2021. Furthermore, in April alone, we delivered well over 300 vehicles, demonstrating our accelerated production ramp. And this growth progression keeps us nicely on track for our 12,000 to 14,000 production target, as Sherry will tell us more about shortly. We're pleased with the demand we're seeing, and now we have more than 30,000 reservations as of today. Note that this 30,000 figure does not include the recent up to 100,000 car deal with the government of Saudi Arabia, which is entirely incremental. I'd like to thank the entire Lucid team for their dedication and hard work. We're off to a great start, and we're only just beginning. We have a lot of hard work ahead of us, but we're up for the challenge, and we're on track for some great milestones this year. In just two short quarters since we started deliveries, we've garnered many industry accolades, beating out some very well-established luxury car brands. The Lucid Air is now used in the same breath as some of the best-known luxury car luminaries in the market. And that's truly amazing if you think about it. In the first quarter, Lucid Air was named the best luxury electric car by U.S. News and World Reports. It was named luxury electric vehicle of the year by Cars.com. And best car to buy 2022 by Green Car Reports. Edmunds very recently reported an unprecedented 505 miles in their real-world EV range test of the Lucid Air Dream R, a new record. But most importantly, it's our customers who are truly delighted with Lucid Air. I believe as we get more of our vehicles into our customers' hands and as we expand our test drive program, our momentum will just continue to build. We're nearing completion of deliveries of Lucid Air Dream Edition and commenced deliveries of Air Grand Touring in the first quarter, also having announced the new Air Grand Touring performance model in April. The dual-motor Grand Touring Performance delivers 1,050 horsepower, making it the most powerful electric vehicle currently available in North America, combined with an exceptional EPA-estimated 446 miles range. The Air Grand Touring with up to 516 miles of EPA-restimated range has an unprecedented efficiency of 4.6 miles per kilowatt hour. And I'd like to spend a minute or two on this because I don't believe the importance of EV efficiency is well understood today. In order to drive widespread EV adoption, we must address the cost of making EVs. And here, the really fundamental question is not how much does a battery cost per se in terms of dollars per kilowatt hour, but moreover, how much does it cost to endow an EV with a given amount of range? For example, how much does it cost to create an EV with, say, 200 miles range or 300 miles range or a 400-mile EV? In this context, it's crucial to compare which is the better route to achieve this goal, a reduction in battery cost or an increase in efficiency. Well, with, say, a 10% increase in efficiency, it is possible to achieve the same range with a 10% smaller and therefore 10% less expensive battery. For example, we believe we can endow Lucid Air Pure with over 400 miles range with a battery pack size of less than 90 kilowatt hours. commercial advantage over the competition. But efficiency also drives other very important benefits. Unlike a gasoline car, where the benefit of efficiency is only felt at the cost of a fill-up at the gas station, an efficient EV is a fundamentally superior product in many ways, influencing weight, agility, range, and interior space and comfort. Reducing battery cost, although not to be dismissed, fundamentally only really benefits the cost of manufacture, whereas we expect increasing efficiency to benefit not only the cost of manufacture, but also the lifetime running costs, plus the lifetime environmental footprint, both through energy consumption and through raw material usage. Now, this final advantage is not to be dismissed lightly, because in a world with a potentially limited raw material supply chain, efficiency becomes the enabler for the manufacture of more electric cars. So, our first step has been to deliver a vehicle with a longer range than anyone else in the market. And our next step later this year will be to deliver a vehicle with a range of over 400 miles, but to achieve this with a smaller battery pack than the competition. And this is Lucid's commercial advantage. Now, we're only able to do this because we design, develop, and manufacture our own technology in-house. It's the combination of our proprietary ultra-compact powertrain, state-of-the-art high-voltage inverter, our bidirectional 900-volt WonderBox, exceptional aerodynamic design, and our scalable and modular battery pack, which is based on our extensive Formula E race experience. I'm aware of only one other who has the technology vertical integration we do. You simply cannot achieve this by buying off-the-shelf components. And I'm proud to say that our efficiency is industry-leading among commercially available passenger vehicles. While others will try to catch up to where we are today, we're not standing still. We're improving on our technological advancements and will drive more innovations and efficiency to remain ahead of the competition. We also continue to and developed 11 over-the-air software updates in Q1. We hear our customers, and we're delivering on their constructive feedback, many through over-the-air updates. We've designed our vehicles from a clean sheet to be one of the most advanced in the market, and with world-class vehicle technology that will enable us to deliver more features and enhancements without customers having to bring their vehicles in for service. We have the capability to control even the smallest of details in the car via software. With our software-defined vehicles, we can change everything from how the door handles function to increasing key fob battery life. And we'll continue to strive to meet the high standards of our customers by making their Lucids better and better over time. So we think we're extremely well positioned in the technology race. But we need to get Lucid Airs into the hands of more customers and ramping production of quality vehicles is my top priority. We have over 30,000 customer reservation holders as of today, demonstrating growing interest in Lucid and rising demand even as new competitors arrive. So we're intently focused on production as well as our expansion. And as you can see from the photo in the shareholder presentation, the AMP factory expansion in Arizona is seeing tremendous progress. And once complete, we'll have an additional 2.85 million square feet of production footprint and increase that annual production capacity in Arizona to 90,000 vehicles per year. We're also very excited to be breaking ground on our new factory in Saudi Arabia soon. And very shortly, we'll have the grand opening of our Munich studio, signaling the arrival of Lucid to the EU market. And more on this next week, when we will debut our EU plans. So our global expansion plans are on track. Now, having said that, I do want to highlight that supply chain dynamics are very fluid, and the COVID lockdowns in China that's impacting others in the industry are also resulting in some bottlenecks for us. But our team is doing an incredible job mitigating this to keep us on track. We also announced today that we're increasing prices of our vehicles that will go into effect at the beginning of June. The world has changed dramatically from the time we first announced Lucid Air back in September 2020. And I want to assure our existing reservation holders that we will be honoring current pricing for all existing customers as well as new reservations made before the end of the month. In order to ensure fairness and prioritization, we will be reaching out to reservation holders to facilitate order configurations in order to lock in pricing as their specified model becomes available. Now, lastly, I want to highlight a landmark agreement we made with the government of Saudi Arabia on April 20th. The government has undertaken to purchase up to 100,000 Lucid vehicles. This is one of the single largest electric vehicle purchases that I'm aware of, and we're delighted to be supporting Saudi Arabia in achieving its sustainability goals and net zero ambitions by bringing our advanced luxury EVs to Saudi Arabia. Shari will go into more details on this momentarily. So, in closing, I believe the electric vehicle market is still in the very early days of secular growth. And I've never been more excited than I am today about our technology, our products, our team, and our future. I firmly believe this is a technology race that is set to play out over the coming years. And I'm highly confident that we are well-placed to be a leader with our state-of-the-art in-house developed technology. With that, let me turn it over to Sherry for an update on our financials. Sherry.