Proactive Investors - Shares in Tesla (NASDAQ:TSLA) rival Lucid Group Inc (NASDAQ:LCID) have continued to climb on speculation that Saudi Arabia's sovereign fund might snap up a bigger stake in the embattled luxury electric vehicle maker.
Public Investment Fund (PIF) is considering buying the EV startup, according to market gossip reported on the website Betaville on Friday.
Saudi Arabia’s government has previously agreed to purchase at least 50,000 Lucid vehicles over the next decade, with an option to buy another 50,000.
Following a disappointing production performance last year, the departure of its CFO in December, disappointing fourth-quarter delivery numbers earlier this month and news that the company had been forced to recall more than 2,000 of its Lucid Air electric sedans, last week the shares sank to a new all-time low of $2.54 - down 77% last year.
After the speculation was published, with a disclaimer that it was an "uncooked" story, the shares closed at $3.37 on Monday and on Tuesday rose another 10% to $3.71.
Analysts said the sharp moves in the shares reflected investors covering short positions, with shorting of the sector having surged last year.
Lucid, set up by British former Tesla engineering chief Peter Rawlinson, grabbed the crown for the EV with the longest range in 2021 but its shares hit the skids last year as it missed many quarterly delivery targets.