Tesla Steals Lucid’s Human Resources Chief; Lucid Share Price May Explode

Tesla, one of the world’s leading global electric vehicle (EV) manufacturers, was looking for a human resources chief. Based on Scott DeReaux’s interview with Tesla CEO Elon Musk he has hired Bostock, who led Tesla’s HR operations for three years until February 2018, for the job. I believe Bostock will manage Tesla’s human resources effort like no one else has before, assisted by John Chen, who had joined Lucid as its interim chief marketing officer (CMO).

(SOURCE: Carbon Black)

I believe Lucid’s hiring of Bostock demonstrates that it wants to integrate the IT systems of its human resources and a sales and marketing department together in order to improve efficiencies and reduce administration and administrative costs. I think it also is a sign that it is now seriously considering cutting jobs to reduce its organizational size by up to 20 percent. This move will be welcomed by other IT companies including Microsoft and Oracle. And these other IT companies should also be watching Lucid’s CEO’s interview on YouTube to know that Bostock is trying to implement practices similar to those of companies like Salesforce and Oracle.

(SOURCE: Carbon Black)

Now Bostock needs to manage Lucid’s employees to see whether the hire from Tesla will be a success, especially at the moment Tesla’s stock is under pressure from these concerns. On the other hand Bostock is not unaware of the risks Lucid faces with its largest shareholder, Liberty Global. This week Liberty Global questioned the management of “Scale Energy,” a Green energy company it purchased in November 2013, only to sell the stake three years later. This is because the company is enjoying higher average prices for electricity than some of its European peers including the UK’s Anglian Power. On the other hand Lucid expects its cash burn to slow down to just USD 5 million a month on average for the rest of the year because it will gain from selling its 6×25=2 lithium gel embedded with oxygen units in the production of lithium polymer batteries.

Most importantly, I believe that the 7.5% stake that Roman Karatz will continue to hold in Lucid is a good development for the company, at least from the standpoint of investors like him and his billionaire partners like Robert Smith.

(SOURCE: Lucid)

Given Lucid’s CEO, its share price and its position as a household name among Tesla’s minority shareholders, the potential downside for Lucid is limited. At the same time, with Lucid’s growing position among Elon Musk’s partners, the risk to Lucid’s share price is not infinite. And investors like Roman Karatz, Robert Smith and Elon Musk know this and will be happy if Lucid’s share price continues to soar.

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All data sources: Carbon Black, Lucid investor relations website

Disclosure: I am/we are long LCZ.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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