Lucid Motors, an electric-vehicle startup modeled on Tesla (TSLA) - Get Tesla Inc Report , while unveiling its Lucid Air sedan prototype at the New York International Auto Show, disclosed that it hasn't yet raised enough money to construct a factory.

The Menlo Park, California-based company said that its midsize, battery-powered sedan reached 217 mph during a test, a statistic that no doubt will attract attention and invite comparisons with the 155 mph top speed of the Tesla Model S sedan. The company, which has been in business since 2007, currently employs about 300.

Lucid is soliciting $700 million in Series D venture-capital investments that will fund a $200 million factory planned to be built in a suburb of Phoenix. Zak Edson, director of marketing, declined to identify the investment bank that is soliciting the funds. The rumor is that Morgan Stanley is quarterbacking financing.

"The right solution for this planet is pure electric," said Peter Rollinson, former chief engineer of the Tesla Model S who serves as Lucid's chief technology officer. Edson said the company is searching for a CEO.

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As the battery and drive components get smaller, Rollinson said, the amount of space in EVs increases for occupants. Lucid Air purports to be "shorter, narrower and lower while providing more interior space than a long wheel base Mercedes S Class."

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The "prestige of a long hood," he said -- the mark of a big internal combustion engine -- is out of date, as are vertical grilles, which are prominent design features of contemporary luxury cars.

Presumably, potential investors are watching the recent run-up of Tesla shares, which have driven the market capitalization of the EV manufacturer, at least temporarily, beyond Ford (F) - Get Ford Motor Company Report and General Motors (GM) - Get General Motors Company (GM) Report . Should Lucid find investors and come to market successfully with a viable model, original investors and the unnamed investment bank stand to realize handsome returns.

But significant roadblocks stand before Lucid and its original investors, which include Chinese investor Jia Yueting, Venrock, Mitsui & Co. and an undisclosed investor that bought the 25% stake belonging to BAIC, a Chinese state-owned enterprise based in Beijing.

Investors may be wary about a wave of electric-vehicle competition that's expected in the U.S. market over the next few years. BMW, Volkswagen's (VLKAY) Audi luxury brand, Volvo and Daimler's (DDAIF) Mercedes-Benz brand have announced plans to introduce a number of high-end battery-powered models. Moreover, consumers have shown lukewarm interest in battery-powered vehicles, particularly in light of low gasoline prices.

Doron Levin is the host of "In the Driver Seat," broadcast on SiriusXM Insight 121, Saturday at noon, encore Sunday at 9 a.m.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.