Lucid Motors will move forward with a rare 1-for-10 reverse stock split, set to take effect on September 2, in an effort to boost the electric vehicle (EV) maker’s struggling share price, according to a Barron’s report. The move comes as Lucid stock trades near record lows and far below early Wall Street expectations for its sales and growth trajectory.

What the Reverse Stock Split Means for Lucid Investors

Lucid shares closed at $2.09 on Thursday, unchanged for the day, before dipping slightly in after-hours trading. Under the reverse split, every 10 Lucid shares will be consolidated into one, raising the per-share price but leaving total shareholder value unchanged. Reverse splits are uncommon and often viewed with caution by traders, as they can signal management’s concern about a depressed stock price.

By comparison, forward stock splits—such as those executed multiple times by Microsoft—are typically interpreted as signals of strong growth expectations. Still, Lucid’s share consolidation is unlikely to bring its stock anywhere close to the average S&P 500 share price of $227, as Lucid is not part of the index.

Lucid Motors Executes 1-For-10 Reverse Stock Split As Ev Sales Lag Behind Projections

Lucid’s Market Performance Is Falling Short of Early Expectations

Lucid’s trajectory has dramatically shifted since its February 2021 peak, when shares reached $58.05. At the time, Wall Street projected the company would generate $15 billion in sales by 2025 on deliveries of roughly 100,000 EVs, according to FactSet data. Today, the picture looks much different: the automaker is on pace to sell about 17,000 vehicles in 2024, with expected revenue of $1.3 billion.

The decline reflects a tougher-than-anticipated U.S. adoption rate. EVs currently account for only 7% to 8% of new car sales in the U.S., roughly half the penetration level in Europe and one-quarter of China’s share. Increased competition has compounded the challenge. In 2021, just nine EV models surpassed annual U.S. sales of 10,000 units; by 2024, that number climbed to over 30 models, giving consumers far more choice across price brackets.

Investor Sentiment Remains Weak

Lucid shares have fallen sharply amid these headwinds, dropping 31% year to date y 42% over the past 12 months, per Barron’s. The reverse split, while boosting the stock’s nominal price, offers little clarity on Lucid’s long-term outlook. Analysts note that while stock splits often signal company momentum, reverse splits may instead reflect pressure to remain appealing to investors or in compliance with listing requirements.

EVXL’s Take

Lucid’s reverse stock split underscores the widening gap between early expectations for EV startups and the reality of slower U.S. electrification. The company’s sales projections have slipped far behind initial forecasts, raising questions about whether premium-focused EV brands can succeed against lower-priced, mass-market competitors that continue to scale production.

For EVXL readers, the key issue is whether Lucid can pivot—through partnerships, broader model offerings, or improved cost structures—to capture growth in an increasingly crowded market. With U.S. EV adoption lagging Europe and China, will companies like Lucid need to rethink their strategy, or is this simply a period of consolidation before broader uptake?

What do you think—does the reverse split buy Lucid time to turn things around, or is it more of a warning sign for investors? Share your views in the comments below.