You Could End Up Spending More for a U.S.-Made EV | Carscoops

      Lucid has recently entered into an agreement with a US-based company to boost its local supply of graphite.

      7 hours ago

      by Brad Anderson

      Lucid has recognized that all automotive manufacturers will need to raise prices in the United States.

      While the company produces its electric vehicles domestically, it maintains an extensive global supply network.

      The automaker is enhancing its collaboration with Panasonic regarding battery materials.

      Even cars manufactured in the US are affected by global economic pressures. Although every Lucid vehicle sold in the country is assembled on American soil, interim CEO Marc Winterhoff states that prices are still expected to rise primarily due to tariffs established during President Trump’s administration.

      While he refrained from explicitly confirming a price increase for Lucid's own models, the message was clear: American consumers should prepare for higher prices on new vehicles.

      Read: Lucid SUV Costs 30% More To Lease Than Sedan Despite Being Cheaper

      In a recent interview, Winterhoff mentioned that the American car manufacturer is keen on further localizing its supply chain. A step taken in this direction includes signing a contract with Graphite One to enhance its supply of domestically processed graphite. Despite these initiatives, the global nature of its supply chain will contribute to higher production costs for the Air and Gravity models.

      Tariffs Increase Costs

      “For American consumers, vehicles will become more expensive under the current tariff system,” he told Bloomberg Television. “There’s no other way around it. While you can say you just need to localize, that still raises costs. The reason the supply chain is so global is that some materials are either unavailable in the US or are simply very costly to source domestically, leading to imports.”

      He further highlighted that even when companies strive to reduce reliance on imports, relocating operations to the US often results in increased costs. This situation leaves automakers with limited options.

      “Even if you make changes, you still encounter higher costs here in the United States, which forces manufacturers like us, or any manufacturer, to increase prices. There’s no other alternative unless you want everyone to function as non-profit entities, which would stifle innovation and technological advancement. In the current global environment, that’s the last thing we need.”

      Adjusting the Supply Chain

      To mitigate the effects of the tariffs, Lucid is strengthening its partnership with Panasonic to source more raw materials for its battery cells domestically. At present, a significant portion of the raw materials used for Lucid's battery cells comes from Japan and South Korea; however, approximately two and a half years ago, the company recognized the need to localize, partly due to advanced manufacturing production credits that helped lower costs.

      “We are collaborating with Panasonic to further localize the supply chain for the battery cells,” Winterhoff noted. “It’s not very beneficial to manufacture here [in the US] if you are still importing the raw materials that are subject to tariffs.”