Ladies and gentlemen, thank you for standing by. And welcome to the Lucid Group First Quarter 2024 Earnings Conference Call. Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker for today, Maynard Um, Senior Director of Investor Relations. Please go ahead.

Thank you, and welcome to Lucid Group's First Quarter 2024 Earnings Call. Joining me today are Peter Rawlinson, our CEO and CTO; and Gagan Dhingra, our Interim CFO and Principal Accounting Officer. Before handing the call over to Peter, let me remind you that some of the statements on this call include forward-looking statements under federal securities laws. These include, without limitation, statements regarding the future financial performance of the company, production and delivery volumes, financial and operating outlook and guidance, macroeconomic and industry trends, company initiatives and other future events. These statements are based on predictions and expectations as of today and actual events or results may differ due to a number of risks and uncertainties. We refer you to the cautionary language and the risk factors in our most recent filings with the SEC and the forward-looking statements on Page 2 of our investor deck available on the Investor Relations section of our website at ir.lucidmotors.com. In addition, management will make reference to non-GAAP financial measures during this call. A discussion of why we use non-GAAP financial measures and information regarding reconciliation of our GAAP versus non-GAAP results is available in our earnings press release issued earlier this afternoon as well as in our investor deck. With that, I'd like to turn the call over to Lucid's CEO and CTO, Peter Rawlinson. Peter, please go ahead.

Thank you, Maynard, and thank you, everyone, for joining us on our first quarter 2024 earnings call. In my prepared remarks today, I'll discuss our partners at the PIF, our better-than-expected production and delivery figures, our cost advantage and our overall momentum, all of which makes me more optimistic than I've ever been about our future. Now I believe there are 2 key factors that really set Lucid apart: our superior in-house technology and our partnership with the PIF, who have been steadfast investors and partners. In Q1, we raised $1 billion in capital through a private placement of convertible preferred stock to an affiliate of the PIF. We are a strategic partner in the country's plan to achieve its Saudi Vision 2030 goals. I'm very grateful for the PIF's continued confidence and their steadfast support. Now turning to production and deliveries. In Q1, we produced 1,728 Lucid Airs, and we delivered 1,967. Both slightly above our expectations. In fact, it was our best quarter-to-date for deliveries, up 39.9% year-over-year. Our lower production than deliveries is an active decision to be cost conscious and is not a reflection of production bottlenecks. For 2024, we expect to produce approximately 9,000 vehicles, which is consistent with our guidance last quarter. Let me now provide you with an update on where I believe Lucid stands today. We've made solid progress on both brand awareness and pricing, with our general brand awareness raising in the first quarter despite reducing media spend from the fourth quarter. Our Lucid Air is increasingly recognized as a superior vehicle in nearly every aspect that customers value. For the third consecutive year, Lucid Air was named the best luxury electric car by U.S. & World Report (sic) [ U.S. News & World Report ] on its 2024 Best Hybrid…

Thank you, Peter. And thank you to those who are taking the time to join us today. Before I get to my prepared remarks, I would also like to start by thanking the entire Lucid team. I am continually amazed by and thankful for everyone's dedication and perseverance. Turning to our 2024 first quarter financial results. During the first quarter, we produced 1,728 vehicles and we reiterate our guidance to produce approximately 9,000 vehicles this year. We delivered 1,967 vehicles in Q1, up nearly 40% year-over-year and up 13% sequentially. In Saudi Arabia, we resolved some of the logistical go-to-market challenges we had in Q4, and we were able to ramp up deliveries in Q1. We are also pleased with North American volumes, which we think is benefiting from growing brand awareness and increasing number of vehicles on the road and improving affordability. We are encouraged by what we are seeing. Turning to the P&L. For Q1, revenue was $172.7 million, up 9.9% sequentially, driven primarily by higher deliveries. Average selling prices were down sequentially due to mix as well as the pricing adjustments, which affected a part of the quarter. Cost of revenue in Q1 was $404.8 million. Despite lower average selling price, our gross margin improved on a quarter-over-quarter basis due to both cost optimization initiatives, including production and Bill of Material and logistics costs and lower impairment charges in Q1 related to LCNRV. The LCNRV amount was approximately $137.8 million or 20.8% reduction from Q4. Fixed costs related to the depreciation of our factories and equipment remains a large part of the cost of revenue. And as we ramp up production and deliveries, we expect the overhead per vehicle to significantly improve. There are many controllable and uncontrollable variables that can affect gross margin. And as a…

Thanks, Gagan. We'll now start the Q&A portion of the call. Before we take questions from those on the phone, I want to post some questions that our retail investors sent into the Say Technologies platform. Our first question is from [ Anav ]. Can you elaborate on Lucid's pathway to profitability? What are the key milestones and challenges the company anticipates facing in reducing production costs and achieving positive gross margins?

Thank you, [ Anav ]. It's all about scale. The more we can scale the more cars we make, the more volume we can spread the fixed cost. That's the cost of our investment, our incredible factory and facility, our long-term investments across the sale of each car. So how do we do that? We need to continue growth of Lucid Air sales right now. And right now, we're trending up 40% from Q1 this year relative to last year. Now in a similar period, we see the sales of Tesla Model S down very, very considerably. We're outselling key competitors like Porsche Taycan. It's a about scale. And the next thing on that scale path is to get Gravity into production that will have a multiplier effect upon the market size and Gravity is scheduled for startup production late this year. And then beyond that, we need to get our midsized vehicle, our volume vehicle price at around, we believe, about $48,000, get that into production and is on schedule for production for late '26. And I've got to tell you just how much our current finances are truly dominated by the major investments that Lucid's made for its future. Things like the expansion of our Arizona first factory, we've got nearly 4 million square feet in there. General assembly is ready. We're putting robots in now for building the body structure for Gravity. We've invested in a huge stamping line, we're integrating logistics, we're bringing a powertrain facility right under that one roof, and that's exactly where we're going to make the units that we supply to Aston Martin, all under one roof. And I think there are some photographs in the presentation, Maynard, and videos on our social media pages. And then the other thing is the real big advantage that Lucid's got over everyone else is efficiency. And I don't say that as an engineer, I say that as a businessman. That efficiency means we can make cars with smaller batteries, with less batteries than anyone else. That means because the battery is the most costly part of an EV, we will be able to make cars more cost effectively and therefore, with more profit margin than anyone else, which leads perfectly to your role, Gagan.

Yes. Thank you, Peter. And 2 things more: scale and continuous cost optimization initiatives. With scale, we'll be able to significantly bring down: number one, the fixed cost per vehicle, including depreciation of the investment we made in the factory, which is a big part of our cost of goods sold; number two, labor and overhead, and you get more efficient when you work at the optimal capacity; number three, also the BOM cost as volume provides a significant cost leverage. Now let me add to the cost optimization initiatives that we have been working very aggressively, and I'm personally leading this on a daily basis with big support from Peter. As I said in the prepared remarks, we were able to reduce the Bill of Materials, which is the cost of the parts that go into the car and also logistics costs significantly this quarter. We have also identified additional opportunities to execute throughout the year.

Our next question from the platform is [ Jason ]. The stock price keeps dropping. What measures will you be employing to bring the price up considerably? It seems product output is extremely low.

Thanks, [ Jason ]. Now look, our share price, again -- again, it's all about volume. So forgive me, because the share price and the part of profitability are interwoven. Against a broader EV market, where the -- other makers products are really down. We're up 40% on deliveries year-on-year. We're bucking that trend. It's all about scale. It's about recognition on the brand, and I believe we're getting there. And we've got Gravity coming. Just to put this in perspective, in Q1, for the first time ever, Lucid outsold Porsche Taycan. We've outsold the Mercedes Benz EQE for the third consecutive quarter. We've outsold the Mercedes Benz EQS as well for third consecutive quarter. We've outsold the new BMW i7. And we've outsold the Audi e-tron GT for the fifth consecutive quarter. I want to also explain another matter here. We are not manufacturing constrained. This isn't a ramp-up situation. We can [ link ] from it. It's very much an economy situation. It's about growing awareness of just how awesome the product is and the sales will follow. And that's the trajectory we're on. It's all about these sales and volumes. And I also want to just put as a final point, I would like to put Lucid's stock price in context for this year. Just for context, Tesla is down about 25.6%. Rivian is down about 56%. We're down 27%. So really, there is a trend here in this sector. But clearly, we've got a path to get out of it. Gagan, do you want to add some color?

Yes. Thank you, Peter. And again, we are also very focused on execution and optimization of cost. We have the most efficient vehicle, but it's not just about the sustainability story. It's about growth, it's about scale, and it's about the profitability. I expect it will show in our margins over time as we scale.

The third question is from [ Justin ]. Is Lucid in talks with any of the legacy automakers to provide battery or motors for production?

Thanks, [ Justin ]. Thanks for the question. I can't emphasize enough. This is absolutely central to the whole vision of the company, and that's why we call it Lucid Group. The vision is to have a meaningful impact upon the planet, upon the environment to take technological leadership. And to use that leadership that we can travel further with less and be truly sustainable and then to share that technology and provide that technology to other companies. And we've taken the first step, we're providing the sapphire technology, our hypercar technology to no less than Aston Martin. And there's a time scale associated with this. I mean the technology that we've got in our current lineup of touring, grand touring was ideally suited to a luxury performance car from another automaker. But what really excites me is the potential for the technology that we're currently developing right here in this building, in Lucid headquarters where I speak, for our midsized tech platform. This is the tech that really is going to suit a high-volume family car of the future. And that's what's going to create the multiplier effect. So as you can appreciate, we can't really talk about specifics. But indeed, we are in talks. There are large OEMs that appreciate the value of our tech, and they are certainly interested in working together with us. Gagan, would you like to add anything to that?

Yes. And of course, under the right economics.

Absolutely. And I think therein lies another misunderstanding. Because of our current finances, there's this completeness information that our tech is so expensive. And it's completely the opposite. Our tech is made for affordability at scale. It's designed around reducing the need for battery, which is the biggest cost item of making an EV. So actually adopting Lucid's technology is a route to significantly reducing the cost of making an EV. And this is simply just not sufficiently appreciated or understood.

Great. And our last Say question is from [ Robert ]. Will Lucid make an affordable car to compete with Tesla?

Well, I've got an answer to that. We already are. The Lucid Air Pure rear-wheel drive, finest machine on the planet, $69,900, the price I promised back in September 2020, we're already competing with Tesla. But wait until our midsize comes out late '26. That's when we'll have a car, $48,000, $50,000, and that is the big one, the one that's going to be really exciting.

Great. Now we'd like to take questions from the phone lines. [ Twanda ], can we take the first question, please?

Our first questions from the line of Adam Jonas.

Peter, you said in your prepared remarks and in the statements that you published that sales momentum is building? Can you quantify what supports that statement? Over what period was it measured? Were you talking year-on-year? Or were you talking about momentum building kind of more during the quarter and sequentially?

Okay. Yes. Adam. So if we look at 2023 versus '22, I believe we were up by 37% or close to 37% on memory. And if you compare Q1 '24 to Q1 '23, that's where we had the 39.9%, very, very close to 40% growth. So we're bucking the trend of the market quite nicely.

Okay. And just as a follow-up, you said that your focus remains on cost, a relentless attention to cost. And you mentioned some big improvements this quarter on BOM costs specifically. Can you give some examples of this improvement in BOM within the quarter? And who are you benchmarking for the BOM cost for the Gravity?

Adam, thank you for your question. So yes, in this quarter, despite the pricing actions, our gross margin improved and is mainly due to cost optimization initiatives, including BOM cost reduction. And within BOM cost, there are various components, and we are working hard with both the supplier side of things and internally, and internally more on the technology side of it, where we are bringing the battery cost down. Our car is the lowest per vehicle range. But also then on the logistics side of it, we are able to bring our cost down significantly quarter-over-quarter. And in addition, we identified a few other initiatives that we want to execute throughout the year. We're also managing our inventory very effectively. That helps bring the cost down.

Our next question comes from the line of John Murphy with Bank of America.

Peter, I don't necessarily mean to conflate the company necessarily with Tesla for many reasons. But I mean, as we look at the SNX, the company was struggling and it wasn't until the [ 3NY ] launch that there was kind of an escape velocity on self-funding. And it seems like we're looking at sort of -- somewhat of a parallel here. I don't mean to make explicit direct comparison, but it does seem like the space or the smaller vehicle launching in late '26 will be sort of where you potentially reach that escape velocity similar to when they hit the [ 3NY ]. So I was wondering if you would maybe kind of concur with that to some degree, right? I hope you don't take a fence to that, but to some degree. And then also, as we think about that, we're seeing sort of these dribs and drabs and I wouldn't say $1 billion is a drib and drab, it's a lot of money. But sort of this question from investors, will you be able to get the funding sort of guaranteed to get to the launch of that escape velocity or maybe it's the space in 2026. So I mean, one, do you kind of agree with sort of that logic that, that's when you reach escape velocity? And will you have the funding to get there?

Thank you, John. An interesting parallel and a very thoughtful question from you, as always. I mean, look, the vision is to get to very significant volume. And clearly, that comes in 2 steps -- well, there's 3 steps. First of all, scale Air more with brand awareness. Step 2, go for about 6x the TAM with Gravity. And I really believe there's a very big significant opportunity with Gravity that Model X didn't capture because Model X was a bit car-like, a bit CUV-like whereas Gravity is a proper SUV, and it's a 7-seat 3-row and we've got this unique secret weapon that we can go further with less battery and address the critical cost of making these products, and which you'll see unfold as we get to a degree of scale which Gravity will enable. But it's true to say that we won't bear full fruition of all that until we get the midsized platform into production and it's scheduled for start of production late '26. Now regarding our partnership, what really makes -- sets Lucid apart is the combination of 2 things: a unique world-class technology, combined with our special relationship with the PIF. And that relationship with the PIF transcends a nearly financial one because they are invested in us a cornerstone of transitioning the economy of Saudi Arabia to a sustainability model with their audacious Vision 2030. And they are -- we are in this together. They are equally incentivized for success. Right now, running in Saudi Arabia is the first car plant they've ever had operating and it's elusive plant. Right now, we're laying the foundations, literally pouring the concrete for our complete business unit, our CBU factory, which is scheduled to sync with the advent of the arrival of the midsize there in Saudi Arabia. They are incentivized for our success. We are mutually incentivized for success, nothing less than success is acceptable here.

Okay. That's very helpful. Just one second follow-up. 9,000 vehicles produced or Airs produced this year. You already delivered more than you produced. I think there's well over 5,000 units or I think there are over 5,000 units in inventory. Could we see deliveries significantly above that 9,000 production number? I think you did 239. Delivery is greater than production this quarter. Should we expect something similar to that go through the rest of the year? Or could it actually be higher?

Well, we haven't guided on that. And actually I'd love to see it. what is crucial here is the key message is that management is taking prudent steps in balancing our production with deliveries so that we don't get an undue amount of inventory and have that working capital tied up. This is prudent from management.

Our next question comes from the line of Itay Michaeli with Citi.

Just 2 questions for me. First, Peter, can you just give us an update on kind of supplier readiness for the Gravity launch? What would the progress you're making there and just over how you're feeling about that? And then maybe a second question, just going back to the gross margin. I know there's a lot of noise in that number. I was hoping you could talk a little bit to what you're seeing across trends for kind of variable margins. They're just kind of looking at parts, material, freight and warranty, excluding kind of labor and overhead costs. If you can give us a little bit of sense of how that's trending, that would be helpful, too.

Thanks, Itay. Yes, so we -- I'm personally overseeing the march towards the Gravity start of production. Literally in this room, every morning, my morning starts with a review of the status. And in order to ready the program, we need to sync 3 activity streams: the readiness of the gravity product, the readiness of the factory, Arizona factory, and the build-out of that and the installation of all the equipment. And the third thing you covered in your question was the readiness of the supply base. And absolutely, we're all over this. We have literally a few hundred suppliers with thousands of parts. Truly drawn upon some of the best suppliers right around the world. And that is something we're managing very closely. And to that aim, I want this process to be really super transparent. So I personally commissioned the team to make a series of videos, which will tell the tale for everybody who's following the company, the path to Gravity, the road to Gravity, the series. We launched that just last week, and that's going to trace those 3 connecting pillars: the product, the factory readiness and supply chain readiness. But we've got a major advantage this time with this product, Itay, because we're not trying to do it coming out of a pandemic. So there should be a lot more opportunity for us to do SQA, which is supplier quality awareness and audit. And we have our supplier quality engineering teams visiting those suppliers and checking and verifying and validating the readiness for starter production late this year. Now regarding margins, I would like to defer the question to Gagan, please.

Yes. Thanks, Peter. So Itay, on the gross margin, we have been working very hard with both the supplier side of things and then taking cost out of the business. And looking at the BOM cost first is a significant effort. We are continuously bringing thousands of dollars out from the cost. But one thing this quarter specifically, I want to call about technology. Our car also has its lowest cost of ownership. And if you look at in the investor deck, we added Slide 7 and Slide 8, explaining how our car has the lowest cost. And it will be good for you to look at that. And then in parallel, our -- the cost optimization team, this team is challenging each and every one and also for every dollar value, and I'm personally leading this initiative with support from Peter. But what does that mean to us, we're able to significantly bring the logistic cost down. We are looking more and more opportunities. Now it's a matter of scale because we today are spending significant amount of money on the fixed cost. Even on the variable cost, we identify more opportunities, and it will help us because look at it from a supplier perspective, also, they also allocate their fixed overhead to the volume they deliver. But we have part to go there. And with Gravity coming late 2024, we are getting close and close to our capacity, and that will give us an operating leverage.

Our next question comes from the line of Andres Sheppard with Cantor Fitzgerald.

Peter, I was just -- I wanted to follow up on maybe deliveries to Saudi Arabia. Trying to get a sense if it's possible to maybe quantify it a little bit as to how that agreement will develop later this year, next year and onwards. I think in the past, you had mentioned that -- and please correct me if I'm wrong, but that a lot of these deliveries would include the Gravity and the midsized high-volume models, which have yet to reach their SOPs. So just wondering, are we able to quantify what these deliveries to Saudi Arabia will be this year, next year as you work your way up to the Gravity and...

Yes. We're not planning to guide on the split in the future, but our deliveries in Q1 exceeded 500 units. I'm very confident that we've got equal demand for our products in Saudi, particularly to the SUV. That's going to be quite an interesting market. But again, I'm not in a position to guide right now on these. And we haven't decided yet where would guide on that specific split, either Andres.

Okay. Got it. That's helpful. But so over 500 deliveries in Q1 were to Saudi Arabia market. So that's helpful. Okay. And then just a question on liquidity. You touched on the updated liquidity. Obviously, the $1 billion recent capital raise fortifies the balance sheet. In your presentation, you mentioned that liquidity on hand is sufficient to fund the business, I believe, is until second quarter of next year. So I guess my question is, as you're thinking for your next capital raise, do you -- to the extent of the ability that you can answer, do you foresee that coming from the PIF or perhaps would that be from external capital? I guess what I'm asking is with $6.4 billion in funding from the PIF so far year-to-date, do you foresee a situation where the next raise may also be with them or elsewhere?

Well, look, we're a technology company. We're on a growth trajectory, and it's a capital-intensive endeavor. We know that. And so all I can say is that we will take an entrepreneurial opportunistic view of raising capital when the business requires it. We are very, very aware and appreciative of a very special relationship and the steadfast support that the public investment fund has shown us and gone every single round supporting us to date. And I think that puts us in a very strong position. It takes us past the start of production of gravity and well into next year. And I think that's an enviable position. It puts us in a very strong position financially.

Our next question comes from the line of Tobias Beith with Redburn Atlantic.

I have 2 questions for Gagan, please, and I'll ask them separately. Through 2024, the expectation is that production processes will become more vertically integrated as you continue to build out the Phase II expansion of AMP-1. Can you confirm whether this will increase losses in the near term while volumes are subscale?

Yes. So as I said in the prepared remarks, we typically don't guide gross margin because of certain controllable and noncountable factors. However, I can provide some directional color. In Q2, I expect that gross margin will remain flat despite the impact -- the full quarter impact of pricing actions we took in Q1. In Q1, that impact us for part of the quarter. Scaling back to second half of the year, now purchase of gravity components ahead of production, which will result in increase in inventory, i.e., result in LCNRV and also higher depreciation as a result of Phase 2 activation, we expect to have some negative impact on the gross margin. But then we have Gravity scheduled for production late this year. As we move to next year, we expect things to change significantly.

Okay. But -- sorry, just to ask my question slightly differently. On a variable margin basis, do you expect the higher vertical integration to decrease the variable margins in the near term, on both Air and Gravity?

Yes, that's a great question. Now it is a game of scale. We're getting better on contribution margin trim by trim. Now the BOM cost, freight and certain overheads, part of contribution margin gets significantly impacted when you have a low volume. And with scale, it significantly improves because suppliers also amortize their fixed cost based on the volume they deliver. It's a matter of scale. The more we get close to our capacity, our margins get much better.

Okay. Understood. And then just to turn back to the question that Adam and Itay asked. If I exclude the impairment charge from your cost of goods sold and make a simplistic assumption that all of the D&A charge is within COGS. Then in the first quarter this year, underlying costs per unit delivered actually increased 5% sequentially. And given that delivery volume was 13% higher with some of these cars presumably benefiting from last year's overproduction. I was wondering if you could comment on what happened?

Yes. It is a factor of incentive as well. So if you look at -- we took some pricing actions in the current quarter. So it's because of the pricing actions, which were largely offset by the cost reduction activities.

Okay. But -- sorry, the pricing actions, surely, they're not in your COGS anymore because I've excluded the impairment charge.

Yes. But it's multiple things that go in that factor. So when we say pricing actions, we basically -- like for Pure and Touring that the pricing that we offered and plus mix, both together play a significant role in that component.

Our next question comes from the line of Steven Fox with Fox Advisors.

I just had a question on the push to have more third-party related sales of hardware and software. I guess I was wondering if you would say over the last few quarters, whether there has been an increasing number of bottlenecks in getting to the finish line on some of these deals. I'm curious just because it seems like you've proven out some cost advantages that you can provide as a -- from a third-party standpoint and the pressures on OEMs to get their BOM costs down have only increased in the last year-to-date. Any color on that and your progress going forward would be helpful.

That's an interesting point, Steve. I would say this that there's a time scale, there's a cadence, there's a chronology associated with any such arrangement with the traditional OE. There's a natural cadence to the place they work and operate. And also, there's this sort of impending regulatory overhang in terms of the drivers for that transition to sustainable mobility model. So all I can say is just watch this space. We need patience when we're talking to large automakers.

Our next question comes from the line of James Picariello with BNP.

This is Jake on for James. So if I just look at your liquidity and the implied cash burn with the $5 billion lasting into the second quarter of 2025. It looks like the implied cash burn has stepped up from roughly $900 million in your previous commentary to over $1 billion now. So how should everyone think about cash burn really through next year once you get through the launch of the Gravity?

Yes. So if you look at -- there are multiple things go into cash burn. One, is the capital investment that we're making. As we have guided, we expect to spend around $1.5 billion in our investments, which is expansion in Arizona taking from 30,000 installed capacity to 90,000 because of paint shop, stamping, body in white coming later this year. And then AMP-2, which is in Saudi Arabia, where we are making significant investment, building our CBU facility. So that capital expenditure play a significant role there. And also in the next year, we have a significant amount of capital expenditure that will continue.

Got it. That's very helpful. And then just following up on John's question about the midsize more mass market model. How do you guys thought about providing some more just detail on it, maybe some teaser pictures a little earlier to try to draw up some just some more interest from a broader consumer base and even potentially opening the door reservation to just generate more liquidity?

Well, that's an interesting point. I actually think that the consumer has been ill-served by some players in this space by taking reservations way, way ahead of time in a very artificial manner. What we believe is a much greater degree of transparency and really getting closer to that product being an absolute reality. Remember that any such reservations and money taken is a false form of liquidity because it's something we would have to put in escrow anyway. It doesn't really -- it's not true liquidity. And we believe in absolute transparency, and showing the product with a realistic specification as we're doing, say, with Gravity. We've not taken reservations deliberately until we get closer to the start of production. This is a philosophy that we've adopted. And we will let you know that time in the future when we open a waiting list for gravity. And we're not even close to. I don't think it's right to be opening up reservations on a product that is over 2 years out. I just don't think -- I think it ill serves the consumer, and it's something that I think there's a transparency that's lacking from that.

Our next question comes from the line of Stephen Gengaro with Stifel.

Just going back to a question about the cash burn. Can you give us any sense as we think getting to the midsize launch sort of the cadence of CapEx necessary in '25, '26 time frame?

Well, I mean, it's interesting. We haven't guided on that. But I mean we are in a very good position, which will see us beyond Gravity start of production. We have some amazing incentives from the Kingdom of Saudi Arabia for a setup of our factory there, our AMP-2 facility, and that's where we're going to put in the midsized product to start with.

Great. And just a quick follow-up on the Gravity order question. How soon before production begins do you open up Gravity orders?

It's an interesting point. I think that -- as I say, look, we can look forward to us opening a waiting list when we feel that in absolute transparency, we can release more specific details of the trim and specifications of that vehicle. I don't want to do it in an environment of opacity. Gravity is scheduled for start of production later this year. And we're on that runway now. Every day counts as we build up a crescendo to that launch, and we will let you know. Watch this space.

Thank you. So this concludes Lucid's First Quarter 2024 Earnings Conference Call. Thank you all for joining us today, and you may now disconnect.