Why Are American-Made EVs Like Lucid Still Getting More Expensive?
If you’ve been eyeing a Lucid Air or Gravity, you might be wondering why prices keep creeping up—even though these cars are built right here in the US. It’s a fair question, and the answer isn’t as simple as “tariffs” or “greedy automakers.” The reality is a tangled web of global supply chains, shifting trade policies, and the hard math of manufacturing in America.
How Do Tariffs Impact the Cost of US-Built Electric Vehicles?
Let’s get straight to it: tariffs are making things pricier for everyone, not just foreign brands. Even though Lucid assembles its EVs in Arizona, many of the parts and raw materials—think battery components, specialty metals, and electronics—come from all over the world. When tariffs hit imports from countries like China, Japan, or South Korea, those extra costs don’t just disappear. They get baked into the final price tag.
Marc Winterhoff, Lucid’s interim CEO, recently put it bluntly: “For the American consumers, vehicles are going to be more expensive under the tariff regime. There’s no other way around it.” He’s not exaggerating. According to a 2024 study by the Center for Automotive Research, tariffs on imported EV components can add anywhere from $2,000 to $7,000 to the cost of a new electric vehicle, depending on the model and how much of its supply chain is overseas.
Why Can’t Automakers Just Build Everything in the US?
It sounds logical—just make all the parts here and dodge the tariffs, right? If only it were that easy. The global supply chain exists for a reason: some materials simply aren’t available in the US, or they’re much more expensive to source domestically. Take graphite, a key ingredient for EV batteries. The US currently produces less than 1% of the world’s natural graphite, according to the US Geological Survey. Most of it comes from China. So, even if Lucid wants to buy American, the options are limited and pricey.
Lucid is making moves to localize more of its supply chain. They’ve inked a deal with Graphite One to boost US-processed graphite and are deepening their partnership with Panasonic to source more battery materials stateside. But here’s the kicker: moving production home often means higher labor and infrastructure costs. So, while it helps with tariffs, it doesn’t always make the car cheaper.
What’s Lucid Doing to Keep Prices in Check?
Lucid isn’t just sitting back and accepting higher costs. The company is actively working to bring more of its supply chain to the US. Their partnership with Panasonic is a big step—by sourcing more battery cells and materials domestically, Lucid can reduce exposure to tariffs and qualify for federal incentives like the Advanced Manufacturing Production Credit.
But there’s a catch. Even with these efforts, the transition isn’t instant. Building new supply chains takes time, investment, and a lot of coordination. And as Winterhoff points out, “It doesn’t do you a lot of good if you manufacture here but still import the raw material which then is subject to tariffs.” In other words, until the US can supply everything needed for an EV, some costs are just unavoidable.
Are Other Automakers Facing the Same Challenges?
Absolutely. Lucid’s situation isn’t unique. Every automaker—whether legacy giants like Ford and GM or newer players like Rivian—is grappling with the same pressures. The Inflation Reduction Act and other federal policies are pushing companies to localize, but the transition is bumpy. According to the Alliance for Automotive Innovation, the average cost to build an EV in the US is still 20-30% higher than in countries with more established supply chains.
This isn’t just about EVs, either. Gas-powered cars are feeling the pinch as well, though the impact is sharper for electric vehicles because of their reliance on high-tech batteries and rare materials.
What Does This Mean for Shoppers Looking at Lucid or Other EVs?
If you’re in the market for a Lucid, brace yourself for potential price hikes. Even if the sticker price doesn’t jump overnight, leasing costs and dealer markups may creep up as manufacturers adjust to new realities. That said, there’s still good news: federal and state incentives can offset some of the extra cost, especially if you qualify for tax credits or rebates.
And don’t forget—automakers are hustling to bring more of the supply chain home. As US-based production ramps up, there’s hope that costs will stabilize or even come down in the long run. But for now, the road is a bit rocky.
The Big Takeaway
Buying an American-made EV like a Lucid isn’t just about patriotism or supporting local jobs—it’s a front-row seat to a global economic balancing act. Prices are going up, yes, but behind the scenes, companies are working overtime to adapt and innovate. The big takeaway? Navigating the EV market isn’t about perfection—it’s about smarter adjustments. Start with one change this week, and you’ll likely spot the difference by month’s end.