Premium electric vehicle (EV) manufacturer Lucid Group (NASDAQ:LCID) is seeing shares dip 5% following an interesting announcement. Earlier today, the company stated that it will partner with NeueHouse, a private work and social home for “creative and professional progress.” Still, the unusual nature of the collaboration may be sparking concern among LCID stock investors.
Essentially, NeueHouse is a workspace provider. To be sure, the company offers a unique take, integrating iconic buildings, cultural events and elevated hospitality (among other attributes) to foster both productivity and inspiration. Nevertheless, at the heart of the business is the coworking model.
Per the official press release, Lucid explains that the “selection of NeueHouse as its cultural programming partner reflects a shared belief that sustainable progress requires not only technological advancements, but also collaboration and inspiration from diverse creative minds.” To that end, NeueHouse provides a dynamic work environment where such collaboration may materialize.
For the coworking space provider, the partnership helps further its “mission to foster an environment where cross-disciplinary creativity leads to groundbreaking innovations.” Still, stakeholders of LCID stock appear unconvinced, with shares losing in early afternoon trading.
LCID Stock Struggles Against EV Sector Fallout
Part of the volatility today could center on the partnership’s messaging disconnect. In particular, coworking space demographics tend to skew young. Indeed, one report indicates that 43% of coworking space members are under 30. Meanwhile, according to an informal Lucid forum, a survey suggests that Lucid EV buyers skew older.
This is by no means a scientific survey, but it’s hardly a surprising result. Meanwhile, according to the EV maker’s website, its lowest-cost Lucid Air model starts at just under $70,000. Keep in mind that the real median U.S. household income came in at $74,580 in 2022. So, targeting the coworking space seems like an odd move for LCID stock.
However, the bigger concern impacting the enterprise right now is the EV sector fallout. Industry pioneer Tesla (NASDAQ:TSLA) is undergoing a rotten session on Thursday, slipping about 4% during the afternoon hours. Glaringly, CNN Business points out that TSLA stock is the worst-performing stock in the S&P 500. Analysts also remarked that Tesla may have further to fall.
On paper, that might seem like a win for LCID stock. However, stubbornly elevated inflation and high borrowing costs have crimped demand across the board. Even luxury EV specialists like Lucid can’t seem to gain traction.
Why It Matters
In fairness, not all hope is lost for LCID stock. Currently, its short interest stands at 28.58% of its float. Further, the short interest ratio clocks in at 10.72 days to cover, which represents the time needed to unwind all short positions based on average trading volume. On the wrong day, the bears could face severe upside risk. However, whether or when that day materializes remains a huge question mark.
On the date of publication, Josh Enomoto did not hold (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.
