Lucid Motors Shares Soar on $300M Uber Partnership, But Analysts Warn of Potential 65% Downside

Lucid Motors (LCID) shares surged 40% on a $300 million investment from Uber (UBER) for a robotaxi agreement. Uber will also invest in Nuro for autonomous technology. The deal validates Lucid's technology and manufacturing capabilities and positions the company at the center of Uber's robotaxi strategy. However, Bank of America analysts reiterated their "Underperform" rating and $1 price target, citing potential for 65% downside from current levels.

Lucid Motors (LCID) saw its shares surge by 40% following a $300 million investment from Uber (UBER) for a robotaxi agreement. The investment, announced on July 17, 2025, positions Lucid at the center of Uber's robotaxi strategy. Uber will also invest in Nuro, a company specializing in autonomous driving technology.

The agreement involves Uber acquiring and deploying over 20,000 Lucid Gravity SUVs equipped with Nuro's AV technology. The vehicles are set to start operating in a major U.S. city by the end of 2026, with a full-scale deployment planned over the next six years [1].

The investment underscores Uber's renewed push into the robotaxi space after exiting in 2020. The deal follows Uber's previous partnership with Volkswagen to supply ID.Buzz vans for commercial service in Los Angeles next year. However, commercializing AV tech remains challenging due to high costs and regulations [1].

Bank of America analysts reiterated their "Underperform" rating and $1 price target for Lucid, citing potential for 65% downside from current levels. The analysts noted that while the investment validates Lucid's technology and manufacturing capabilities, the company faces significant challenges in the autonomous vehicle market [2].

The Lucid-Nuro prototype is already operating autonomously at Nuro's testing facility in Las Vegas, demonstrating the feasibility of the technology. Nuro, co-founded by former Waymo engineers, has expanded from last-mile delivery vehicles to providing its self-driving technology for commercial and passenger vehicles [1].

Uber's latest move aligns with the broader trend of companies investing in autonomous vehicles. Tesla has launched a robotaxi trial in Austin, and Alphabet's Waymo is expanding its services. However, these efforts have been met with challenges, including high costs, tight regulations, and federal investigations [1].

The robotaxi market is gaining momentum, with Google subsidiary Waymo currently holding the strongest position in the United States. Tesla's limited robotaxi service in Austin and Uber's driverless rides in Atlanta and Austin highlight the growing interest in autonomous taxis [2].

The Lucid-Nuro-Uber partnership represents a significant step forward in the development of autonomous robotaxis. The collaboration combines Lucid's advanced vehicle architecture, Nuro's self-driving technology, and Uber's global platform to deliver a fully integrated robotaxi experience [3].

References:
[1] https://www.reuters.com/business/autos-transportation/uber-invest-300-million-ev-maker-lucid-part-robotaxi-deal-2025-07-17/
[2] https://guardian.ng/featured/uber-invests-300m-in-lucid-motors-in-robotaxi-push/
[3] https://investor.uber.com/news-events/news/press-release-details/2025/Lucid-Nuro-and-Uber-Partner-on-Next-Generation-Autonomous-Robotaxi-Program/default.aspx