Lucid Group closes the week in a more contradictory position than ever — borrow costs falling sharply, yet the stock down 13.5% and short interest creeping higher, with options traders running their most defensive posture in months.
The clearest development this week is how far and how fast borrow costs have collapsed. Cost to borrow has dropped to 8.9%, down from around 15.7% a week ago and a fraction of the mid-July peak above 175%. That descent is now relentless — costs have more than halved every two weeks since late July. But the important distinction is what is driving it. Availability has not meaningfully improved. The lending pool sits at just 2.6% — for every 100 shares already out on loan, fewer than three remain available. Last week's note flagged availability at 3.4%; it has tightened further, not loosened. The cheaper borrow reflects short sellers retreating on price, not brokers returning supply. For anyone trying to build a new position at scale, the constraint has not gone away.
Short interest itself is nudging in the wrong direction for anyone hoping for an unwind. At 17% of free float — roughly 55 million shares — it rose about 4% on the week. That is a continuation of the pattern flagged in the previous note: rather than covering into the borrow-cost decline, shorts are staying put or adding modestly. Days-to-cover from the most recent FINRA settlement is 6.2 days, reflecting how illiquid any forced covering would be. The ORTEX short score has eased slightly from its recent high above 80, landing at 75.1 — still firmly in bearish territory and ranking in the bottom 3rd percentile of the universe on short score. Options confirm the defensive tilt. The put/call ratio is 1.88, above its 20-day average of 1.76, and the 52-week high on that ratio was 2.46, hit just eight sessions ago. The options market has been running a consistently defensive posture for weeks, not a spike followed by normalization.
The Street is anchored in Hold, with seven analysts there and no current Buys beyond Citigroup's lone $11 target — down from $14 in August and $17 at initiation in March. That is a consistent pattern of downward target revision across all covering firms, without any rating upgrades to offset it. The mean target of $8.11 is nearly 80% above the current $4.55, which looks generous given the trajectory. The bear case is straightforward: repeated capital raises, suspended 2026 guidance, deeply negative gross margins, and a stop-sale episode have compounded execution risk. The bull case rests on $3.2 billion in liquidity, a midsize platform due in late 2026, and the Saudi sovereign wealth fund Public Investment Fund's 44.9% reported stake — which carries activist 13D status on the register. PIF trimmed from 60.8% to 56.9% in its April filing, so the stake has been declining at the margin. Uber Technologies holds a further 9.6% after a large position build reported in April. Stakes at these levels mean two shareholders control over half the company, which both anchors the float and limits organic price discovery. Per ORTEX's disclosure, both positions are as-last-reported around the 5% threshold and may have moved since.
Earnings history reinforces the caution. The last two prints each produced single-day drops of approximately 10–13%, with five-day returns following in the same direction. The next event is scheduled for November 6 — still two months out — but the pattern of post-earnings selling is consistent enough to matter to how the market frames the setup now.
Among correlated peers, RIVN fell 7.2% on the week while XPEV dropped 3.7%, suggesting sector pressure is real but Lucid's decline at 13.5% is running at roughly double the rate of its closest EV comparables. The November earnings date is now the next hard anchor — between now and then, the borrow cost trajectory and whether availability begins to normalize are worth watching closely.
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