Lucid Group NASDAQ:LCID, an electric vehicle maker, saw its shares collapse Tuesday after a report said the company is working with restructuring adviser AlixPartners and evaluating options that could include bankruptcy protection or a move to take the business private. The report, published by the EV industry trade publication, placed renewed pressure on Lucid's stock as investors reacted to the possibility of a major restructuring. Shares fell as much as 57%, marking the company's worst intraday decline on record and triggering multiple trading halts because of the extreme volatility.
Lucid confirmed to Bloomberg News that it is working with AlixPartners, but pushed back strongly against reports suggesting that a bankruptcy filing may be under consideration. The company described industry speculation about a possible filing as completely false, creating a sharp contrast between the report and Lucid's public response. Even with that denial, the scale of the share-price decline suggests investors may remain focused on the company's decision to bring in a restructuring adviser and the range of strategic options reportedly being assessed.
The pressure also reached Rivian Automotive NASDAQ:RIVN, a peer electric vehicle maker, whose shares dropped as much as 3.5% during the session. Rivian's decline suggests the Lucid report may have weighed on sentiment across parts of the electric vehicle sector, as investors considered whether concerns surrounding one company could increase scrutiny of other EV makers. For Lucid shareholders, the immediate focus is likely to remain on any further clarification about AlixPartners' role and whether the company is considering alternatives beyond the bankruptcy scenario it has denied.