Churchill Capital Corp IV (NYSE:CCIV), the SPAC that is soon to be merging with Lucid Motors has seen renewed interest in its stock lately. CCIV stock had reached a bottom price of about $17.5 before nearly doubling to $27.
Clearly, the hype and momentum is starting to gather around the stock.
It’s easy to see why with the upcoming launch of the Lucid Air.
Lucid has made the conscious decision to exclusively target the high-end luxury market for its vehicles. Last year Lucid unveiled the Air a pure electric high-end luxury sedan.
The company claims that the Lucid Air will be the “most advanced electric vehicle” in the market with unmatched performance.
The starting price for the line-up is $77,400 ($69,900 taking into account tax credits) which is a fairly large chunk of change.
This puts the Lucid Air at roughly the same price range as Tesla’s (NASDAQ:TSLA) Model S. So how does the Lucid Air stack up to the Model S? Pretty well actually.
CCIV Stock and the Tesla Challenge
The Lucid Air boasts some truly impressive specifications and features.
The Lucid Air can accelerate from 0 to 60 mph in 2.5 seconds, making it the fastest car on record when announced last year. Lucid claims that its car can consistently run a quarter-mile in 9.9 seconds.
This speed has been recently surpassed by Tesla’s $130,000 Model S Plaid, its top-of-the-line sedan. The Model S Plaid can go from 0 to 60 mph in 2.5 seconds and run a quarter-mile in 9.25 seconds.
The Lucid Air still holds a few key advantages over its competitors. Namely in the form of its expected range of 517 miles on a single charge.
This is much higher than the Model S Plaid’s expected 390 miles of range. Furthermore, Lucid’s Advanced Driver-Assistance System has a sensor suite that includes high-resolution LIDAR.
I believe adopting Lidar at the very start gives Lucid a long-term advantage over Tesla in the realm of autonomous driving.
Lucid Is Ramping Up Its Execution
Lucid has done a pretty good job building its brand and drumming up hype for the Lucid Air.
The company ran a television campaign last January to generate buzz and excitement for the car. Lucid also hilariously bought a television spot right after Elon Musk’s introductory monologue on “Saturday Night Live.”
This is hilarious given the fact that Musk himself is a bit of a troll.
This marketing push has paid off. The company announced that the Lucid Air has over 10,000 reservations for its luxury sedans. This is really impressive for two reasons.
The first is that Lucid is a relatively new automobile manufacturer and doesn’t have any cars on the road yet.
The second is that the company’s vehicles are in the “luxury” category and thus have a relatively expensive price point. This shows the trust and brand building that Lucid has been able to accomplish.
Lucid is well aware of the trust it has received and the company is hard at work to make sure that there aren’t any production issues in its vehicles.
We have seen first hand from Tesla what kind of damage production issues can cause to a brand. In an interview with CNBC, CEO Peter Rawlinson stated that the cars are in the quality validation run and the company is hard at work getting the “quality right.”
Lucid has the potential to disrupt the electric vehicle market. The company is making all the right moves and has a “killer” product with proven demand.
Lucid’s merger with Churchill is coming at a critical time for the company. By the end of the year, the SPAC merger should be completed and the first Lucid Air cars should be on the road.
I can see the potential for Lucid to 2x. Investors should consider investing early into CCIV stock.
On the date of publication, Joseph Nograles did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.