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Discussion Starter · #1 ·
It's been a rough week or so for the stock. Do you all think the downward trajectory will continue? I'm starting to wonder if it will even dip below the $78 DSP price? 😬

What are you all expecting?
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Motley brought up some good reasons to sell that we should continue considering.
1. Rivian's "skateboard" tech isn't a game-changer
Founded in 2009, Rivian is a U.S-based automaker focused on building electric SUVs and pickup trucks. It sets itself apart by specializing in the utility-vehicle niche. The company relies on a modular chassis design called the "skateboard," which houses the battery and other components in a single unit that can be adapted to its entire lineup and sold to other automakers.

Rivian's skateboard module can help simplify its supply chain, letting the business scale up faster. But while the concept has garnered interest from other companies like Ford and Amazon (which is reportedly working with Rivian to build 100,000 skateboard-based delivery vans by 2030), Rivian is also facing challenges from its partners.

In November, Ford dropped plans to co-develop an EV using Rivian's technology. And this follows the cancellation of plans to build a Lincoln EV using Rivian's skateboard in 2020. According to Ford's CEO Jim Farley, the change in plans has to do with the complexity of combining Rivian's architecture with Ford's software, along with Ford's own technological strides in developing EVs.

The cancellation suggests that Rivian's skateboard design might not offer enough advantages for external automakers to consider it worthwhile to incorporate into their vehicles. And this begs the question: What's so special about Rivian, anyway?

2. Stiff competition
With Rivian's skateboard not looking like a game-changer for the EV industry, its economic moat looks significantly shallower. And in terms of branding and economies of scale, the company may struggle to establish itself against significantly better-positioned rivals.

In the utility-vehicle niche, Ford has a clear branding advantage. Its F-Series line of pickup trucks has been America's best-selling pickup for 43 years in a row. And its lineup is already being adapted into EV models such as the all-electric Ford F-150 lighting and electric Ford Expedition SUV, both for the 2022 model year. Ford plans to have 40% to 50% of its sales volume all-electric by 2030. Ford's transformation makes it a direct competitor to Rivian, which is targeting essentially the same market for electric trucks and SUVs.

Rivian will also face competition from Tesla -- which aims to capture market share in the utility vehicle segment with its cyber truck, which is expected to launch in late 2022.

3. Astronomical valuation
With a market cap of $104 billion, Rivian overshadows Ford (worth $77 billion) and General Motors (worth $93 billion), despite not generating material revenue with a net loss of $288 million in the third quarter. The company's valuation is hard to justify because the legacy automakers are significantly further ahead in actually producing and selling EVs.

For example, Ford's EV sales volume surged 195% year over year to 14,062 vehicles in October alone. But Rivian has only delivered 156 R1T pickup trucks as of October (mainly to Rivian employees). And while the upstart will likely scale up its production over the long term, so will its rivals.
 
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