While global manufacturing output has dropped sharply in 2020, the electric vehicle (EV) sector has motored ahead, with EV start-ups moving forward with new factories and raising billions off the back of soaring stock prices. Unlike traditional automotives, the quest for EV supremacy is no longer a speed race.
“It’s going to be down to a tech race, and it’s going to be Tesla and Lucid in that tech race,” says Peter Rawlinson, chief executive and chief technology officer of California-based Lucid Motors, a start-up whose rapid timeline captures the enthusiasm in the sector.
Founded in 2007 as a battery supplier called Atieva, the company shifted gears in 2016, when Mr Rawlinson joined the company. A former vice president at Tesla, he joined with the goal of applying the lessons he learned as the chief engineer of the Model S to build an even better electric car.
Since then, the company has secured a $1bn investment from the Saudi Public Investment Fund, built a $700m plant in Casa Grande, Arizona, and opened a network of retail stores. The result is the Lucid Air, Mr Rawlinson’s next-level electric car, set to start production in December.
Arriving in Arizona
“We looked at about 65 sites, all across the US, and we had a number of selection criteria,” says Mr Rawlinson, explaining why the company decided to build their plant in Casa Grande.
He says that proximity to their headquarters in California was the number one factor, but that the enthusiasm of Arizona officials was crucial to the decision.
“I've got a great rapport with Doug Ducey, the governor of Arizona, whom I've got to know personally,” he says. “Actually we had senators Flake, McCain, and governor Ducey all at the same table with me back in 2016, I had to pinch myself. Isn’t that a landmark meeting?”
Unlike Tesla, whose first plant is a former GM facility in Fremont, California, Lucid opted for a greenfield site — the first purpose-built EV plant in North America. “Sometimes, rather than renovate that old cottage that’s a hundred years old, it’s simpler just to build a new house for yourself,” Mr Rawlinson says, citing the resources needed to repair and retrofit older facilities.
Other considerations were access to high-tech talent and proximity to Lucid’s supplier base in Mexico. “We’ve got quite a bit of parts being shipped north. Casa Grande and the Arizona plant are only 400 miles from Mexico.”
Born of the desert
As Lucid puts the Arizona desert on the automotive map, it is considering doing the same for another desert on the other side of the world. With Lucid now majority-owned by the Saudi Public Investment Fund, Mr Rawlinson says he hopes to help the country build out its own automotive industry.
“We’re having a chat about that right now at a very senior level, executive level, within the kingdom,” he says. “It could be pure electric,” he adds, arguing that an EV industry could become a symbol of Saudi Arabia’s preparation for a future without oil.
He even considers launching a new product reflecting the company’s Saudi connection. “We could make a unique product born of the desert, forged in the desert. Can you imagine that? Could be pretty awesome.”
At the same time, Mr Rawlinson stresses the company’s US roots: “First and foremost, we're an American company. I think that we're actually adding to America’s preeminence in this field, and I think that is a great thing for the US. All that [intellectual property] belongs here in the US. We’ve created this engine room of ideas and innovation which is going to keep on going. And that's going to help the US over the next decade.”
Even with Lucid expanding in Arizona and possibly in Saudi Arabia, the industry that emerges may look different from traditional automotive manufacturing, with Mr Rawlinson saying that the most successful EV companies will be the more vertically integrated ones.
“After the turn of the century, after the millennium, a lot of car companies became less and less vertically integrated,” Mr Rawlinson explains. “I would seek to buck that trend, go for a little bit more vertical integration than many, but not the degree that Tesla's going to.”
While he thinks Tesla has gone too far, he prefers its approach to the strategy of most other new EV start-ups: “If you look at the other players in this space, they’re all talking about outsourcing their manufacturing, asset light, all this stuff... how on earth is that gonna work? There’s only been one conspicuous success story in this space, and that’s Tesla. And Tesla has the very antithesis of an approach. It’s super vertically integrated.”
As a result, Lucid plans on manufacturing its key technologies in house, starting with the body and powertrain before expanding further: “We’ll gradually increase vertical integration in selected areas which bring most value and differentiation to the product. These other electric car companies don’t want to do it at all, they just don’t do anything. I think they just want to do some sort of design exercise.”
To Mr Rawlinson, Lucid’s commitment to bringing its key technologies in-house is what sets it apart from other EV start-ups, particularly as the US EV industry faces increased competition from China.
“You’ve got a lot of talk about these hundreds and hundreds of Chinese electric car companies. Well, a lot of them are mom-and-pop shops; 95% of those companies don't stand a chance, there is virtually no technology at all,” he says.
“I don't see a single Chinese EV company, not one, that can hold a candle to Tesla — not even close, not within 10 years. Nio is the best, and they’re not even close to where Tesla is technologically.”
Lucid on the other hand, claims its technology is even more advanced than Tesla’s. Its drivetrain is smaller and Mr Rawlinson says his most recent lab data shows that it is 17% more efficient, putting it 3.8 years ahead of Tesla’s progress on efficiency.
Mr Rawlinson also compares Lucid to Porsche, which sourced parts of the drivetrain for its all-electric Taycan from external suppliers.
“For Lucid, all of the drivetrain will have Lucid written on all of it. And that is what's going to make a difference.”
This article first appeared in the December/January print edition of fDi Intelligence. View a digital edition of the magazine here.