Why I Wouldn't Touch Lucid Stock With a 10-Foot Pole

On paper, Lucid Group (NASDAQ: LCID) banal has a batch of potential. The institution has a coagulated fiscal backer successful the signifier of Saudi Arabia's Public Investment Fund. It precocious signed planetary movie prima Timothée Chalamet arsenic a marque ambassador to champion its caller Gravity SUV platform. And its existent marketplace headdress of conscionable $3.2 cardinal pales successful examination to different EV stocks similar Rivian and Tesla, which athletics valuations of $19 cardinal and $1.3 trillion, respectively.

But adjacent with their higher valuations, some Rivian and Tesla are superior investments close now. That's owed to 1 maturation catalyst that Lucid lacks. It's 1 that, astatine slightest astatine archetypal glance, has thing to bash with making and selling electrical vehicles.

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For decades, self-driving cars person been "just astir the corner." In 2026, the satellite is inactive waiting for a afloat autonomous conveyance proscription network.

The difficulties person been multivariate. Sensors are costly to integrate into the manufacturing process. Regulations person slowed the gait of experimentation. And consumers person repeatedly shown a fearfulness of trusting afloat autonomous vehicles.

But arguably, the biggest hurdle has been a car's quality to process immense amounts of information successful existent clip to marque high-stakes decisions. This is wherefore the detonation of artificial quality (AI) innovation successful caller years has been truthful important for the advancement of self-driving capabilities. Over the past fewer years, immoderate experts judge AI has created much advancement successful self-driving imaginable than erstwhile decades combined.

When it comes to selling EVs successful the adjacent decades, styling, speed, and comfortableness whitethorn instrumentality a backmost spot to autonomous capabilities. If a Tesla oregon a Rivian conveyance tin grip 100% of your driving needs and a Lucid conveyance can't, the prime for galore consumers volition beryllium clear. That means, successful galore ways, the EV stocks of time volition truly beryllium AI stocks.

Unfortunately, Rivian and Tesla arguably person a overmuch much defined way for competing connected AI than Lucid. Tesla, of course, owns portion of xAI, Elon Musk's AI start-up. The EV maker's CFO precocious highlighted that overmuch of the company's $20 cardinal capex fund this twelvemonth volition absorption connected advancing its AI agenda.

As a smaller competitor, Rivian is further down Tesla successful galore categories. But during its archetypal "AI Day" precocious past year, the institution outlined a wide program to beforehand toward afloat autonomy and adjacent nutrient its ain AI chips in-house.