Another small electric vehicle (EV) company is trying to catch Tesla, and the efforts by the world’s largest car manufacturers have continued to fall apart. Rivian Automotive Inc. (NASDAQ: RIVN) posted appalling earnings. (Click here for the 13 biggest electric vehicle business failures in American history.)
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Rivian shares are down over 75% in the past year as it announced earnings from its most recent quarter. Its market cap is still too high, at $17 billion, for its failures. The Wall Street Journal noted another “check engine light”: “Rivian depleted its cash reserves at a faster rate than in previous quarters, reporting that it had $11.6 billion in cash and cash equivalents as of Dec. 31, about $2.2 billion less than at the end of the previous three-month period.”
D.A. Davidson Senior Equity Research Analyst Michael Shlisky said Rivian’s forecast growth rate for this year is too low to recover. The first part of the Rivian quarterly announcement showed that its production last year was also too low at 24,227. That was less than Wall Street expectations.
Rivian’s comments about high ratings, awards and cost efficiencies will be lost on Wall Street. More important, Rivian lost $1.7 billion in the fourth quarter, on revenue of only $663 million. For the year, it lost $6.8 billion, on revenue of $1.7 billion. Just as critical was that its cash balance at the end of the year was $11.6 billion, down from $18.1 billion at the end of 2021. Rivian easily could run out of money.
Rivian’s problems spread beyond its financials. It must make progress against industry leaders. The first is the troubled Ford F-150 Lightning, which, when its production problems end, will sell into a market with millions of F-150 gasoline-powered pickups.
The two other highly successful pickups in America, the Chevy Silverado and Ram, will come to market with electric versions soon. If Tesla ever gets its act together, its Cybertruck will be available in a year.
Rivian is just too small and too slow to market.
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