Lucid Group, Inc.

Ladies and gentlemen, thank you for standing by and welcome to the Lucid Group first quarter 2024 earnings conference call. Please be advised that today's conference is being recorded. Later, we will conduct a question and answer session. To ask the question during this time, please press star 11 on your touch tone telephone. You would then hear an automated message advising your hand is raised. To remove yourself from the queue, please press star 11 again. I would now like to hand the conference over to your speaker for today. Maynard Alm, Senior Director of Investor Relations. Please go ahead.

Thank you, and welcome to Lucid Group's first quarter 2024 earnings call. Joining me today are Peter Rawlinson, our CEO and CTO, and Gagan Dhingra, our interim CFO and principal accounting officer. Before handing the call over to Peter, let me remind you that some of the statements on this call include forward-looking statements under federal securities laws. These include, without limitations, statements regarding the future financial performance of the company, production and delivery volumes, financial and operating outlook and guidance, macroeconomic and industry trends, company initiatives, and other future events. These statements are based on predictions and expectations as of today, and actual events or results may differ due to a number of risks and uncertainties. We refer you to the cautionary language and the risk factors in our most recent filings with the SEC and the forward-looking statements on page two of our investor deck available on the investor relations section of our website at ir.lucidmotors.com. 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 our investor deck. With that, I'd like to turn the call over to Lucid CEO and CTO, Peter Rawlinson. Peter, please go ahead.

Thank you, Maynard. And thank you, everyone, for joining us on our first quarter 2024 earnings call. In my prepared remarks today, I'll discuss our partners at the PIF, our better than expected production and delivery figures, our cost advantage, and our overall momentum, all of which makes me more optimistic than I've ever been about our future. Now, I believe there are two key factors that really set Lucid apart, our superior in-house technology and our partnership with the PIF, who have been steadfast investors and partners. In Q1, we raised $1 billion in capital through a private placement of convertible preferred stock to an affiliate of the PIF. We're a strategic partner in the country's plan to achieve its Saudi vision 2030 goals. I'm very grateful for the PIF's continued confidence and their steadfast support. Now, turning to production and deliveries. In Q1, we produced 1,728 Lucid Airs, and we delivered 1,967, both slightly above our expectations. In fact, it was our best quarter to date for deliveries, up 39.9% year over year. Our lower production than deliveries is an active decision to be cost-conscious and is not a reflection of production bottlenecks. For 2024, we expect to produce approximately 9,000 vehicles, which is consistent with our guidance last quarter. Let me now provide you with an update on where I believe Lucid stands today. We've made solid progress on both brand awareness and pricing with our general brand awareness raising in the first quarter despite reducing media spend from the fourth quarter. Lucid Air is increasingly recognized as a superior vehicle in nearly every aspect that customers value. For the third consecutive year, Lucid Air was named the best luxury electric car by US and World Report on its 2024 Best Hybrid and Electric Car Awards. Lucid Air is the only EV to win this category award three years in a row. Another achievement that sets us apart. Lucid Air solves buyers key concerns. It has price parity with gas car equivalents. It's the longest range and fastest charging production car in the US market. It's engaging to drive with remarkable performance and it enjoys a lower total running costs due to its efficiency. Now, consumers are savvy and they recognize the deficiency of other EVs in the market, particularly the limited range of most EVs. To ease fears of range anxiety, other automakers must produce and install bigger batteries, which results in higher cost to charge the vehicle and longer relative charge times versus Lucid Air. Remember, Lucid Air is the most efficient vehicle in its class, as measured in miles per kilowatt hour, while leading the industry for range and charging speed and having a lower total cost to charge. I've seen commentary about our losses per vehicle, but such speculations reflect a lack of knowledge about our costs and our scale-up intentions. Inside the extensively high cost of goods line item is the cost of the factories and equipment needed to make the vehicles and scale our business. If we envisage the company would only make a small number of vehicles, we would have purchased less equipment and built a smaller factory. But we have a more ambitious goal to provide affordable, long-range EVs for mainstream mass market consumers. And as we scale, the leverage in our model should become obvious. And we're embarking on a transformational phase, the expansion of our vehicle lineup. Lucid Air Pure is already here with a starting price from $69,900. And the Gravity SUV program is scheduled for start of production late this year. Our SUV's total addressable market is six times larger than the market we could access in 2023. And the excitement is palpable. In a third-party survey, already two-thirds of EV SUV purchasing tenders would consider Lucid. And this is worth emphasizing, two in every three people intending to purchase an electric SUV knows and would consider Lucid. Amongst all SUV purchase intenders, EVs and gas SUVs, more than 50% would consider Lucid. Now, this is a staggering figure for any brand, let alone a new one, and thus reflects the significant opportunity ahead. We are continuing to invest in our future with further vertical integration, stamping, body and whites for the Gravity SUV program, paint shop expansion, and powertrain at AMP1, an important part of our longer-term cost and quality strategy. We've applied all of our learnings from AIR and incorporated them into our SUV program. So I'm confident that Gravity will redefine the segment with world-class range, efficiency, charging speed, and interior volume. Later this year, we plan to host analysts and institutional investors at our AMP1 facility in Arizona to show you our state-of-the-art factory manned by our incredible employees and the machines that build the machines. We'll also have vehicles on the road later this year for you to test drive. And following the Gravity SUV program, we see another step change in total addressable market expansion with our midsize vehicle, which is scheduled for start of production in late 2026. I'm confident that we can achieve unrivaled levels of efficiency for this crucial mid-sized class vehicle. And again, I can't stress enough, efficiency is the key to a smaller battery for any given range. And a smaller battery is a key element to lower cost when it comes to making an EV. I can't wait to show you our mid-size game changer. Next, I'd like to talk about our technology business. Our Aston Martin deal continues to generate more interest in our technology from other prospective partners. And additionally, we are the sole supplier of the front drive unit to a leading electric racing series. Please watch this space as we continue to discuss monetization opportunities across all aspects of our technology, including our world-class software. I'll close with additional details about our momentum. We surpassed 12,000 vehicles on the road in Q1, which takes us nicely past the critical threshold into boosting word of mouth awareness. And I'm pleased with the 39.9% year-over-year uptick in sales in Q1 and with the momentum we're seeing here in April. I always offer caveats. We expect typical seasonal slowing in Saudi Arabia in Q2. And we expect typical seasonal slowing globally in Q3 as consumers go on vacation. Despite this, for the first time, I feel we're on the cusp of escape velocity. We have sales momentum, a compounding efficiency advantage, unprecedented interest from consumers and corporate partners, more than $5 billion in total liquidity, and gravity, which I believe is on track to become the world's best SUV. Therefore, I've never been more confident in our future. So, before turning the call over to Gagan, I would like to take a moment to acknowledge a recently announced management change. Derek Carty will now lead digital's organization as interim head, taking over from Mike Bell, who will be leaving to pursue other opportunities. I'd like to thank Mike for all of his contributions. Mike joined Lucid in early 2021 and was instrumental in building a truly unparalleled software organization. Mike will be staying on for a period of time in an advisory capacity, and I have full confidence in Derek and the digital organization as we enter into our next transformational phase of the company. So I'll end with a big thank you to all of our suppliers, our partners, and our shareholders. And most of all, thank you to all these employees for your commitment, your dedication, and sheer hard work. So with that, I'd like to turn it over to Gagan Dhingra to provide an update on our financials. Gagan.