Lucid Group, Inc. (Nasdaq: LCID) brands itself as a leader in sustainable mobility, even participating in the United Nations Global Compact, a voluntary initiative promoting corporate responsibility in human rights, labor, environmental practices, and anti-corruption.
“The UN Global Compact challenges companies to conduct business responsibly by aligning their operations and strategies with the UN’s Ten Principles.”
— Lucidmotors.com, April 19, 2023 news release
But while Lucid talks about sustainability, its financial health is anything but stable. Without financial sustainability, even the most promising environmental initiatives can collapse. Producing fewer than 10,000 cars per year, Lucid has burned through billions in losses. Yet, its biggest backer—the Saudi Public Investment Fund (PIF), which owns 59% of the company—continues to pump money into the struggling EV maker.
The Public Investment Fund is the sovereign wealth fund of Saudi Arabia. It is among the largest sovereign wealth funds in the world with total estimated assets of US$930 billion. Is this a genuine effort to build a sustainable American car company, or just a vanity project for the oil-rich kingdom?
The Saudi PIF has positioned itself as a major investor in renewable energy and electric vehicles, but its track record raises questions. The fund has spent heavily on flashy, high-tech projects, often with little regard for long-term profitability. Lucid is one of its most high-profile EV investments, yet the company has failed to scale production to a level that justifies its enormous costs. The PIF’s willingness to keep writing checks suggests that Lucid’s survival has less to do with financial success and more to do with Saudi Arabia’s broader ambitions in the global energy transition.
Meanwhile, Lucid’s board hasn’t been shy about rewarding its executives. In 2021, the company approved a $565 million compensation package for CEO Peter Rawlinson, at a time when the company had barely generated revenue. That meant awarding him nearly $1 in stock-based pay for every $1 in projected revenue—a model that doesn’t work unless explosive growth follows. It didn’t. Lucid’s stock has since plummeted, erasing billions in market value, and now, in 2025, Rawlinson is walking away—though not empty-handed. He’ll receive $120,000 per month for two years as part of a consulting contract, plus $2 million in restricted stock units.
more normalize $6.8 million in 2023 a year and change before his departure from the struggling
automaker.
While Lucid struggles to survive, the Saudi Fund has remained silent on whether it will keep bankrolling the company indefinitely. The financials tell a grim story: Lucid has lost $10 billion while generating just $2 billion in car sales over the past five years. This is not a sustainable business model, and if the PIF decides to cut its losses, Lucid may not have the means to continue.
awarded a $1.00 in stock value for future $1.00 revenue performance.
obviously sustainable strategy. Rewarding, or trying to reward the CEO with over $500 million seems
equally unsustainable. Rawlinson’s departure reinforces the point.
The bigger question is whether the Saudi Fund is serious about creating a thriving EV industry or simply using investments like Lucid for geopolitical leverage and reputation-building. With its deep ties to the fossil fuel industry, Saudi Arabia’s commitment to sustainability remains an open question. And if Lucid fails, it will be a lesson in how throwing money at a problem doesn’t always lead to real change.
__
Over the last couple years I have become increasingly aware of the large pay packages afforded to the C-Suite. I didn’t know if they were appropriate because organizing all the proxy documents to get some context would take many hours of work. So we built www.MySayOnPay.com to provide one-click access to; Executive Pay, Historical Context, Peer Group comparisons, Historical ROE of the Company and Net Profit.
These are the essential datapoints to get a quick idea on who is your CEO. Are his/her interests aligned with shareholders and other stakeholders. Check it out. Input a company symbol like Coca-Cola (NYSE:KO).
Cooper also provides a boutique investment advisory. Contact him at [email protected]
