Shares of Lucid Group (LCID -7.73%) fell on Monday. The luxury electric vehicle (EV) maker's stock had dropped 7.9% as of 3:10 p.m. ET. The drop came as the S&P 500 and Nasdaq Composite were up by 0.4% and 0.5%, respectively.

The stock is seeing a retreat after a major jump following last week's announcement that it has inked an important deal with Uber Technologies.

Lucid nets a win

On Thursday, the company announced that it is partnering with Uber and the autonomous driving company Nuro to bring robotaxis to a "major U.S. city" by next year. Nuro's technology will be integrated into Lucid's Gravity SUVs, helping boost sales of the company's new vehicle.

Image source: Getty Images.

News of the partnership sent Lucid stock flying; however, it seems to be retreating somewhat as investors digest details of the partnership. Although the 20,000 SUVs Uber intends to purchase are a boon for Lucid, the deal is spread out over six years, meaning the 3,000 to 4,000 vehicles Lucid would deliver per year would not transform its delivery numbers. Furthermore, the "multi-hundred-million-dollar" investment Uber intends to make in Lucid could lead to stock dilution.

Challenges remain

Lucid continues to struggle to turn a profit, and its sales volume is much lower than it needs to be. While the company's Gravity sales have been encouraging, they are still lagging behind targets set by the company itself. I have serious doubts Lucid can execute a turnaround, especially given the relative softness of the broader EV market.