Lucid Group(NASDAQ: LCID) stock took off this morning, surging 7% higher as of 11 a.m. ET. Although the electric vehicle (EV) maker announced its quarterly numbers last week, a post by the company on X, the social media platform formerly known as Twitter, piqued investors' attention.
This past weekend, Lucid revealed on X that its Air sedan recently participated in tests for the California Highway Patrol (CHP). The company posted pictures of a modified version of the sedan, equipped to look similar to the patrol cars used by the police agency.
In short, Lucid's only vehicle model currently on sale -- the Air -- could soon find its way into the fleet of law enforcement agencies. Although several police departments in California already use EVs, it will be a first for Lucid.
The Dubai police recently added the Air Grand Touring trim line to its fleet. Lucid has a close connection with the Middle Eastern region. Saudi Arabia's sovereign public fund, the Public Investment Fund, is a major stakeholder in the EV maker. In 2022, the Saudi Arabian government also signed an agreement with Lucid to buy up to 100,000 vehicles over 10 years.
Is this good news for Lucid stock?
Although Lucid stock rose today, I wouldn't read much into today's trigger until Lucid confirms entry into the fleets of CHP or any other police agency. That will be good news, but the company has much to deal with otherwise.
Lucid stock hit its 52-week low earlier this month after falling 37% in October. The EV maker's production volumes remain low, and it continues to sell more shares to raise money, further diluting shareholders' wealth. Just days ago, Lucid reported a net loss of more than $990 million on revenue of only $200 million for the third quarter.
Lucid is placing big bets on its Gravity SUV, which will go into production this year. But only time will tell how strong the demand for the SUV will be and whether Lucid will be able to boost production and deliver the cars on time -- something it failed to do with its Lucid Air.
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Neha Chamaria 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.
