Navigating Troubled Waters
Since Iran largely blocked the Strait of Hormuz amid its conflict with the U.S., the automotive industry has been significantly affected. Automakers have adjusted their strategies due to shipping disruptions, while car owners have been dealing with high gas prices.
Despite the ongoing conflict in the Gulf region, Lucid is soldiering on with its manufacturing expansion plans in Saudi Arabia through the AMP-2 plant. This means the American luxury brand will continue to navigate geopolitical uncertainties while dealing with financial challenges and slowing EV demand in the U.S. The risks may be worth taking, given that the plant is scheduled to produce the Cosmos, an all-electric midsize crossover that could help transform the company from a relatively low-volume manufacturer into a larger-scale EV maker.
Kyle Edward – Autoblog
The Next Frontier
The upcoming Lucid Cosmos will ride on a new midsize platform, which will also underpin two other models. More importantly, the Cosmos will be the brand’s answer to the Tesla Model Y, the world’s best-selling EV. Rivian has also taken a similar approach with the R2, which outsold the R1S and R1T combined in the third quarter of this year.
According to Lucid CEO Silvio Napoli, via Automotive News, the “midsize will expand Lucid’s addressable market more than eightfold.” Napoli, who took office in June 2026, also acknowledged the production headwinds in Saudi Arabia, saying, “Given the rapidly evolving situation in the region, our teams are constantly reevaluating potential scenarios and putting additional mitigations in place.”
The EV maker decided to carry on with its Middle East production plans because its AMP-1 factory in Arizona is primarily designed to produce the Air and Gravity. That’s despite AMP-1 being underutilized amid slowing sales. Adding a dedicated assembly line for the Cosmos would “create inefficiencies.” Saudi Arabia also offers substantial financial backing and an opportunity to establish a larger manufacturing operation.
Lucid
A Cosmos Within Reach
The Cosmos is expected to roll off the AMP-2 assembly line in the second half of 2027, nearly a year later than the original timeline. Lucid said the new EV model will start at under $50,000 before destination charges, making it a more affordable alternative to the Gravity, which starts at around $80,000.
While the Cosmos could help the automaker improve profitability and combat ongoing financial losses, Lucid is also tapping into the robotaxi business to diversify its revenue sources beyond traditional retail vehicle sales. It has partnered with Uber and autonomous-driving technology company Nuro to introduce a robotaxi based on the Gravity.
Lucid
