While Tesla Inc. (NASDAQ: TSLA) stock experienced a downturn this year, the situation for smaller electric vehicle (EV) maker Rivian Automotive Inc. (NASDAQ: RIVN) was even more challenging. Unlike Tesla, which saw a recovery in its shares, Rivian’s stock continued to drop, reaching a staggering 61% decline. The company’s sales, which are relatively modest, coupled with the industry’s overarching issues, have created a bleak outlook for a rebound. Furthermore, the company’s market cap of $9 billion appears disproportionately high given its current prospects.
Rivian delivered 13,588 vehicles in the first quarter ended March 31, compared to analysts’ forecast of 12,500. However, shortly after that, it fired workers at its Georgia plant. According to Business Insider, this was the company’s fourth layoff in the past several years.
In 2023, Rivian produced 57,232 vehicles and delivered 50,122, double the production and deliveries from 2022. Those numbers barely mattered. The company lost $5.4 billion, compared to a $6.8 billion loss in 2022. Rivian is bleeding cash.
Rivian cannot dodge the sea change in the industry. People are increasingly turning their backs on EVs. They worry about the number of charging stations, the range of vehicles, and their prices. Rivian’s flagship R1T has a base price of $69,000. Its R1S has a base price of $74,900. The median price for a new car in the United States is between $40,000 and $45,000. (Check out the five best EVs to drive forever.)
Rivian will be one of the losers in the EV industry. Along with the trouble in the industry, it is up against Tesla and every large car manufacturer in the world.
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