Nov 7 (Reuters) - Lucid beat Wall Street

expectations for third-quarter revenue on Thursday and

reiterated its annual production forecast as it benefits from

strong demand for its luxury electric sedans.

The company reported third-quarter revenue of $200 million,

narrowly beating estimates of $198 million, according to data

compiled by LSEG.

Lucid's upbeat revenue comes as it slashes prices and offers

incentives like cheaper financing to woo customers who have been

gravitating towards less-expensive hybrid vehicles as high

interest rates pressure budgets.

The company - backed by Saudi Arabia's sovereign wealth fund

- still expects to make 9,000 vehicles for the full year. This

means the company would have to manufacture 3,357 cars in the

last three months of the year to hit its target.

The company delivered 2,781 vehicles in the third

quarter but reported a sequential drop in production,

manufacturing 1,805 vehicles.

"We continue to see improvements to gross margin performance

as our cost reduction efforts are gaining momentum," interim CFO

Gagan Dhingra said.

It reported gross margins of negative 106.2%, compared with

negative 134.5% in the previous quarter, while posting a wider

net loss from a year ago.

The EV firm is still losing tens of thousands of dollars per

vehicle, even as rivals such as Rivian are sharply

cutting costs to turn profitable.

Lucid opened orders for its Gravity SUV on Thursday as it

looks to enter the lucrative SUV market and take some market

share from Rivian and EV titan Tesla.

Last month, Lucid announced a public offering and private

placement of roughly 637 million shares, raising $1.75 billion

that would provide it with cash runway well into 2026, CEO Peter

Rawlinson said.

Cash and cash equivalents for the third quarter came in at

$1.89 billion, compared with $1.35 billion in the preceding

three-month period.

(Reporting by Zaheer Kachwala in Bengaluru; Editing by Anil

D'Silva)