Earlier this week, Lucid Group (NASDAQ: LCID) reduced the prices of its Air series of high-end sedans for a limited period ahead of the holiday season.

The price change comes in response to intense competition and a decline in the demand for electric vehicles.

The demand for EVs has been affected by elevated interest rates, prompting automotive manufacturers, including the leading company in the sector, Tesla (TSLA.O), to lower their prices in order to maintain their market position.

According to a report by Cox Automotive, the ongoing electric vehicle (EV) price war has led companies to prioritize sales over profit margins, resulting in a decrease in the average price of EVs to $50,683 in September.

Lucid responded to this trend by reducing the price of its Air Touring model from $95,000 to $87,500 and cutting the price of the more powerful Grand Touring by $10,000 to $115,600.

Additionally, the company lowered the price of its all-wheel-drive Air Pure from $82,400 to $74,900. However, the cost of its latest rear-wheel-drive Air Pure remains unchanged at $77,400.

Lucid had reduced its car prices in August due to a challenging economic environment and the company's increased expenditure during the production ramp-up phase.

Nevertheless, the backing from the Public Investment Fund of Saudi Arabia has provided Lucid with a much-needed injection of liquidity, setting it apart from other companies in the industry facing financial constraints. Lucid is scheduled to release its third-quarter results on Tuesday.

According to the company, the current price reduction offer will remain valid until November 30.

Shares of LCID are up 2.41% in afternoon trading on Friday.

By Michael Elkins | [email protected]