Lucid Motors plans to reduce its workforce by 12% to “enhance operational efficiency and allocate our resources effectively as we progress towards profitability,” based on an internal memo acquired by TechCrunch.

The memo states that hourly workers in manufacturing, logistics, and quality assurance are exempt from these layoffs. While the exact number of layoffs remains uncertain, it is expected to be in the hundreds. As of the end of 2024, Lucid Motors reported a global full-time employee count of 6,800.

“Parting ways with colleagues is always challenging,” interim CEO Marc Winterhoff mentioned in the memo. “We appreciate the efforts of those affected by these decisions, and we are offering severance packages, bonuses, ongoing health benefits, and transition assistance to support them during this time.” The company did not offer an immediate response to a comment request.

These layoffs occur as the firm is actively increasing its production and distribution of the Gravity SUV. Following initial production and quality challenges with the Gravity, Lucid Motors has regained momentum and successfully doubled its output for 2024 compared to the previous year.

Additionally, the company is set to unveil a more budget-friendly mid-size electric vehicle later this year, projected to retail around $50,000. It is also working with Uber and Nuro, a self-driving vehicle firm, to launch a robotaxi service in the San Francisco region this year. Lucid Motors will disclose its financial results for 2025 next week.

“Crucially, today’s measures do not alter our strategy,” Winterhoff detailed in the memo. “Our fundamental priorities remain intact, and our attention is still on commencing production of our Midsize platform. With careful execution, we also aim for further entry into the robotaxi market, continuing advancements in ADAS and software, and boosting sales of Lucid Gravity and Air in both current and new regions.”

Lucid Motors has nearly completed a year without a permanent CEO. Peter Rawlinson, who served as chief executive and chief technology officer, unexpectedly resigned on February 25, 2025. Since his departure, Lucid Motors has experienced considerable changes within its executive team, including the exit of the chief engineer, who filed a lawsuit against the company in December for wrongful dismissal and discrimination. (The claims have been described by Lucid Motors as “absurd.”)