Tesla rivals Rivian, Lucid and Fisker were doing great a few years ago. Amid growing investor interest, electric vehicle makers held large market capitalizations and spoke of a bright future.
Today things look much less promising. The electric vehicle sector is facing slowing growth and even market leader Tesla has warned of difficult months ahead. For its less established rivals, the term “challenging” isn’t enough.
Last month, Rivian announced a disappointing quarter and outlook and said it would cut its salaried workforce by about 10%. Its market capitalization has slumped to $11 billion from a peak of $153 billion in 2021.
Gene Munster, managing partner at Deepwater Asset Management, addressed the idea this week of Apple, which recently shelved its electric vehicle project, buying Rivian, noting the low valuation. Apple “needs to get into some new markets,” he told CNBC. “They need to do something big and potentially Rivian would be the answer to that.”
Of course, it would be an unusual move for Apple. Its most expensive acquisition to date was a $3 billion takeover of headphone maker Beats Electronics in 2014. Amazon, which buys delivery vans from Rivian, is the electric vehicle maker’s largest shareholder, with about 16 % of its shares hit hard.
Last month, Musk said of Rivian: “They need to cut costs massively, and the executive team needs to live in the factory or die.” He suggested that the company had about six quarters before it went bankrupt.
A “general collapse of electric vehicles”
Lucid, meanwhile, has seen its market capitalization plummet from a peak of $91.4 billion in 2001 to $7.6 billion today. Last month, it said it would build only about 9,000 electric vehicles this year, far below the 90,000 it forecast for 2024 three years ago. His difficulties led to speculation last year that Saudi Arabia’s sovereign wealth fund, which owns about 60% of the electric vehicle maker, would acquire the rest. This did not happen.
As for Fisker, its market capitalization stands at $258 million, down from $4.1 billion in 2021. Last month, it received a warning from the New York Stock Exchange for non-compliance as its shares have closed at less than $1 on average for 30 consecutive trading days. And the National Highway Traffic Safety Administration is investigating allegations of “unintentional vehicle motion” in Fisker’s Ocean SUV, which recently received a much-watched negative review from influential YouTuber Marques Brownlee (aka MKBHD).
Reuters, citing anonymous sources, reported this week that Fisker is in advanced talks with Nissan over a partnership and financial lifeline. Under the deal, the Japanese automaker would invest $400 million in Fisker’s truck platform and build its pickup truck in Alaska expected to start in 2026.
“I believe we have a future, otherwise I wouldn’t be here,” Henrik Fisker, CEO of Fisker said Yahoo Finance this week, declining to address the Nissan issue directly. “And I think we’re going to get out of this, I would say, general collapse of electric vehicles that’s out there.”