Why Lucid Motors, Nio, and Li Auto Stocks All Crashed This Week

Major U.S. stock indexes are hitting new highs again this week, but some electric vehicle (EV) stocks accelerated in the other direction. Lucid Group (NASDAQ: LCID) led the EV stock plunge with a drop of about 24% as of Friday midday trading. Chinese EV names (NYSE: NIO), and Li Auto (NASDAQ: LI) weren't far behind with declines of 15.5% and 8%, respectively, according to data provided by S&P Global Market Intelligence.

Investors were selling these names for company-specific reasons, but also due to a tempered outlook for EV sales globally. China is the largest EV market in the world, but its economy is struggling, and government efforts to spur growth didn't give investors what they hoped for this week.

The big hit for Lucid shares came when the company announced new plans to raise cash. That's just over two months after the company said its largest shareholder, Saudi Arabia's Public Investment Fund (PIF), was committing another $1.5 billion to help sustain the company as it works to grow EV sales.

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Source Fool.com