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As investors in Lucid Group Inc. struggle with the problem of owning too many goodies, some early investors seem to be preparing to exit.

The luxury electric car startup fell to a new low on Wednesday, with a drop of 19%. This is the first time a major investor has been allowed to sell shares since it went public through a special purpose acquisition company (SPAC) in July. Investors could have foreseen its arrival: the lock-up period has been known since February.

When Lucid’s SPAC transaction with Churchill Capital Corp. IV was officially announced, it was partly due to its widespread appeal among meme stock traders and wealthy investors. As ordinary investors hyped up the possibility of the electric car revolution, Lucid and Churchill touted $2.5 billion in supporting financing for the merger—the largest common stock PIPE, or public equity, related to the SPAC transaction at the time Private investment. company.

The PIPE is based on the Who’s Who of Institutional Investors and includes funds and accounts managed by the Saudi Public Investment Fund, BlackRock, Fidelity Management and Research Co., Ltd., and Franklin Templeton. The financial commitment is also unique because it comes with a clause that these holders can freely trade their shares on the date of PIPE stock registration or September 1. 1 ——The ones who come later shall prevail.

CEO Peter Rowlinson was elated at the time and said in an interview shortly after the deal was announced: “We have been able to attract the bluest chip companies to make long-term investments in us. I just see that SPAC is now just a useful tool to achieve this goal. ”

A representative for Lucid Group declined to comment on Wednesday.

As of Tuesday’s close, Lucid’s market value is approximately US$32 billion, but it has not yet delivered a car to customers. The company expects to produce about 577 cars this year and increase production to 20,000 next year, but it has not announced an official production start date.

According to data tracked by Bloomberg, Saudi Arabia’s public investment fund is Lucid’s single largest shareholder and participates in PIPE. Prior to the SPAC transaction, the fund invested more than US$1 billion in Lucid in 2018 and often stated that it views Lucid as a long-term component of the country’s 2030 economic diversification goal.

At the close of trading in July, PIPE investors held a total of 166.7 million shares. Regardless of whether it is a blue chip or not, some holders seem to be limiting their profits as they wait for Lucid to hit the road.

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