Benzinga - by Anan Ashraf, Benzinga Editor.
Future Fund Managing Partner Gary Black does not see advertising helping luxury EV maker Lucid Group (NASDAQ:LCID) overcome its bad pricing strategy.
What Happened: “Advertising can't overcome a bad product/pricing strategy,” Black said in a post on X. He was responding to an X user who noted that Lucid shares have been slumping despite advertisements.
“We've been short $LCID all the way down,” Black added.
The quoted post showed a sponsored tweet about Lucid winning “2023 World Luxury Car Of The Year” juxtaposed with its struggling stock, with a user sarcastically saying, “As you can see advertising is working great for Lucid!”
Advertising can't overcome a bad product/pricing strategy.Apple iPhone a much better analogy for $TSLA.
We've been short $LCID all the way down. https://t.co/G1V3fjSkkm
— Gary Black (@garyblack00) February 9, 2024
Black And Advertising: Black is a strong proponent of advertising, particularly for EV giant Tesla Inc. He has often reiterated his opinion that Tesla must spend more on advertising its vehicles to increase deliveries rather than cut prices, thereby hurting its margins.
In a post in late October, the fund manager recommended that Tesla should use a combination of price and advertising to further its mission of accelerating the world's transition to sustainable energy.
But Tesla, unlike Lucid, is more like an Apple iPhone, Black said.
Lucid’s Pricing Strategy: Lucid’s Air sedan starts at $77,400 for its base Pure version. The higher-end Sapphire edition is priced at a whopping $249,000. The Gravity SUV is also priced similarly.
Tesla’s cheapest vehicle, meanwhile, is the Model 3 rear-wheel drive starting at $38,990. The most expensive vehicle from the EV maker is the higher-end version of the Cybertruck, called the Cyberbeast, priced at $99,990.
Price Action: Lucid shares closed up 3.9% at $3.51 on Thursday. However, the stock has been down 15.4% year-to-date and nearly 66% over the past year.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
Read Next: ‘EVs Cannot Sell:’ Top Luxury Car Dealer Points To Tesla’s Margins ‘Dropping Like A Rocket Ship’ While Gas Cars, Hybrids Are ‘Flying Off The Shelves’
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