Lucid denies bankruptcy rumors after stock plunge

Lucid Motors' stock plummeted over 50% on Tuesday after an EV-focused blog reported that the company was considering filing for Chapter 11 bankruptcy or going private. The company quickly denied the report, calling it 'completely false,' but the damage to its stock price and the broader EV sector was immediate.

The rumor and the denial

The report, published by EV, claimed that restructuring firm AlixPartners had advised Lucid's board to consider bankruptcy or a take-private deal, and to focus on the Gravity SUV. Source: CNBC Lucid confirmed it hired AlixPartners but denied the recommendations, stating the firm is 'assisting us in that and nothing else and has not recommended bankruptcy to management or the Board.' Source: TechCrunch The company also sent a cease-and-desist letter to EV, alleging the report caused serious investor harm. Source: The Verge

Market and company turmoil

The stock was halted multiple times for volatility, closing down about 16% after recovering from intraday lows. Source: The Next Web The panic also dragged down shares of Rivian and Polestar, highlighting investor anxiety over EV startups. Source: The Verge Lucid has faced significant headwinds: two rounds of layoffs in 2026 (totaling 30% of staff), a production cut at its Arizona factory, and the loss of the $7,500 federal tax credit. Source: CNBC, TechCrunch The company has sufficient liquidity to operate into next year, according to its quarterly filings. Source: Ground News