Travis Hoium
Motley Fool Analyst, Author of Asymmetric Investing
Rivian and Lucid are adding supply into a US EV market facing demand destruction and rising interest rates, which pressure prices and demand further. Cox Automotive reports US EV sales dropped dramatically over the past two quarters after the tax credit ended, and buyers are already trending to combustion vehicles. That mix makes both stocks unattractive to own. x.comÂ
Rivian's R2 is going to flop, because once a carmaker goes low cost it is game over. Rivian is burning massive cash while the auto market weakens fast on rates and inflation, and its $21B market cap should be closer to Lucid's. x.comÂ
Lucid is dead money as the EV hype cycle and subsidy tailwinds fade, especially under the Trump administration. Tesla is the only dominant EV player, and Rivian may survive long term only with near-flawless execution; everything else, including Lucid, is dead money. x.comÂ
Rivian's Q3 results appear to have crushed expectations, adding a record revenue quarter to its growth case. At first glance, revenue was $2.16B versus $2B estimated, and the loss was $0.48 per share versus $0.74 estimated. x.comÂ
Rivian is next in line for trouble once investors stop funding its cash-burning business. Lucid's stock fell 48% to an all-time low after a report that it is considering going private or filing for Chapter 11; Lucid had not commented. x.comÂ
Rivian has yet to prove it can build cars profitably, and its self-driving effort is far more than two years behind Tesla's, a total dealbreaker. That rebuts @calistoker123's case that R2 is the second-best US EV and that Rivian, at a $23 billion market cap, could deserve $100 billion if it executes on R2, R3 and self-driving. x.comÂ
Tesla's distraction with merging with SpaceX makes Rivian a great buy here. x.comÂ
Ford's low-price push against Chinese EV makers is unlikely to end well because the segment is intensely price-sensitive and Chinese manufacturers innovate and refresh models at a frightening pace. Ford should expect margin erosion, and one successful pickup would not dent the disruption under way. x.com x.com x.comÂ
Rivian's plan to scale cost-efficient R2 and R3 models is unlikely to work well. Steady-state demand and price point remain unproven, an $85K loss per car is a large hole to climb out of, and even if all of that goes well it has no path to Level 4 self-driving. x.com x.comÂ
Rivian is now the pure EV play. Its deliveries rose 30%, and new models plus continuing tech improvements are on the way. x.comÂ
Rivian is unappealing, as 37% whale accumulation on its monthly chart explains the stock's lack of price momentum. x.comÂ
