65% Drop in Rivian Stock
Rivian has found the electric vehicle (EV) sector to be a challenging business, as seen by the almost 65% decline in its stock price over the past year. Contrast this with Tesla, a competitor, which, despite experiencing a sell-off, has partially recovered and is currently seeing a 31% decrease in its shares. Ford, a maker of conventional cars, has seen a 27% decline in share price.
Rivian Is Losing Market Share in the EV Sector
Due to the company’s inability to become even a small player in the EV industry, investors appear to have lost trust in Rivian’s capacity to compete in that market. When Ford sold almost all of its shares in the electric vehicle company, this feeling was mirrored. Rivian recently had to lay off 6% of its workers, which was a significant setback. Since then, the EV market has entered a pricing war, which Rivian may not be able to survive.
Finances of Rivian in Doubt
Rivian’s market valuation is now under $16 billion despite having $13 billion on its balance sheet at the conclusion of the most recent reported quarter, which has investors worried. Additionally, the corporation lost $5 billion in the first nine months of the year while having $995 million in revenue, which makes their $13 billion reserve look inadequate.
Challenges with Production and Backorders
According to management at Rivian, the firm has 114,000 car backorders. Only 6,584 automobiles were delivered in the quarter, so the business will need to increase production to keep up with demand and keep consumers from looking elsewhere.
Competitors that aren’t EV Players
Surprisingly, Rivian’s primary rivals might not even be other EV manufacturers. Over six million Ford F-150s have been installed, creating a large chance for the future F-150 Lightning sales.
A Losing Edge
Rivian no longer has the edge it did two years ago, when people were eagerly anticipating new automobiles. Investors are growing more cautious as the firm currently faces several difficulties and barriers.