Stock price - do people realize Rivian (RIVN) is NOT Tesla (TSLA)??

[R1Tom]

Someone could attempt a hostile takeover but shareholders would have to agree to it. Since RJ has super shares that have more voting power he would almost certainly have to agree to it.

Thanks! That helps me a ton!

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[the long way downunder]

If it hits $15 I'm buying $5k worth. Right now my avg is $28

We're in the season of "take the tax loss" and "wash sale" selling pandemonium causing a disorderly, one-sided market as traders and "investors" large and small want to clean the slate and start 2023 with no losses carried on the books. They'll tell their clients, "compared to the S&P, you've done well in 2022" (meaning they lost capital.)

The problem being, analysis of $RIVN is suspended till $TSLA finds a bottom.
Some analysis of $TSLA points to $TSLA trading $20 to $30 (currently $110.) That could happen as soon as March-May if Tesla doesn't have the right things to say about delivering on promises of revenues, production and products like the Cybertruck, FSD and even another postpone of the Roadster II could be all the institutional investors need to confirm their apparent bias to discount $TSLA … and thereby bring the whole EV sector lower.

These sellers in the closing of 2023 are robots (computer software trading algorithms written purposely to use known price behavior to accumulate money from "the many" to distribute it to "the few" … ) given a purpose (in this case, to convince year-end "take the loss" sellers to quit) then "stay out for 30 days to avoid wash sale rules" then they find … dammit $TSLA $200, $RIVN $30 … dammit! … : )

The next thing that happens is a price increase that "the many" don't trust, then the price continues to increase and it seems too high to buy into the rally, "wait for the next pull-back" … which will happen … but even then, "the many" will no longer trust "buy the dip" so they hesitate at $RIVN $25 and .. dammit $RIVN $30 again …

Wind the clock forward to this time 2024 and we'll be having the same debate with $RIVN $75 … it would be so great to get it "cheap" at $65 … : )

All that said, what do I know, I'm just another passerby on an Internet forum, so expect the opposite to prove true … but one thing I would say is "conventional" must be wrong because most people lose money while most years, the markets close higher year over year. The situation this year being the markets are closing lower but the widely held stocks are closing (on a percentage basis) with greater losses than the overall markets (S&P or NASDAQ indexes.)

 

[cardad]

Watching the stock prices over the past few weeks, when Tesla goes down, Rivian goes down. When Tesla goes up, Rivian goes up. Despite the overall market doing the complete opposite. And often at very similar percentages of decline. Makes no sense other than to think many uneducated investors think the two companies are tied together?? Looks like Elon's Twitter fiasco is costing Rivian investors money as it appears many think they're related somehow.

Two ENTIRELY DIFFERNT COMPANIES!

This correlation may be true but Rivian has been deemed a “zombie company” by New Construct whereas Tesla has the highest FCF of any automaker. In the high interest rate, high inflation environment with substantial negative free cash flow Rivian doesn’t have a great path to improving their current financial situation without eventually seeing 1) lower rates and/or 2) a cash infusion. Lucid already lined up $1.5 B from their Saudi overlords. Rivian is still ok but they are bleeding cash and will absolutely need more to even have a chance at eventually breaking even. EVs have suddenly become a crowded space and the market is generally risk averse at the moment.

 

[Count Orlok]

This correlation may be true but Rivian has been deemed a “zombie company” by New Construct whereas Tesla has the highest FCF of any automaker. In the high interest rate, high inflation environment with substantial negative free cash flow Rivian doesn’t have a great path to improving their current financial situation without eventually seeing 1) lower rates and/or 2) a cash infusion. Lucid already lined up $1.5 B from their Saudi overlords. Rivian is still ok but they are bleeding cash and will absolutely need more to even have a chance at eventually breaking even. EVs have suddenly become a crowded space and the market is generally risk averse at the moment.

why should I care what one firm, that has been anti-Rivian since the IPO, says?

 

[the long way downunder]

This correlation may be true but Rivian has been deemed a “zombie company” by New Construct whereas Tesla has the highest FCF of any automaker. In the high interest rate, high inflation environment with substantial negative free cash flow Rivian doesn’t have a great path to improving their current financial situation without eventually seeing 1) lower rates and/or 2) a cash infusion. Lucid already lined up $1.5 B from their Saudi overlords. Rivian is still ok but they are bleeding cash and will absolutely need more to even have a chance at eventually breaking even. EVs have suddenly become a crowded space and the market is generally risk averse at the moment.

I'm not one for fundamentals, but Rivian has orders, it has production, it has billions in capital, and it has Jeff Bezos. It must be 3+ years away from any financial woes. Of all the EV startups, Rivian is the only one that's a serious going concern. Its biggest problems come after 2025 as VW, Toyota, GM, Ford, the 100+ EV startups in China, pretty much all auto industry manufacturers and the surrounding industries begin producing EVs in all shapes and sizes at all price points. That's why I think Rivian continues as a niche, "boutique" EV with the R2, never able to scale up to compete with Tesla and Tesla is losing market share while increasing unit production, so it's not keeping ahead of the still nascent EV competitors.
That said, the US EV market will be a very different complexion once BYD, Xpeng and others bring their business to the US. I think it will be analogous to Toyota arriving in the US last century. Hopefully Ford, GM, Chrysler, Rivian and others are well under way with plans to offer vehicles that consumers will want (that offering must include a charging network … we're a year into the $7.5B infrastructure bill and I'm not sure what we're seeing in terms of new charging stations on the ground.)

 

[kizamybute']

Today, Tesla rises and so do Rivian and the others!!

I guess I'm still a Tesla fan rooting for Tesla to succeed as that seems to be the only way Rivian's stock will increase! LOL.

 

[mkg3]

Just to clarify, while Tesla is losing market share, the whole EV market is growing. In other words, total quantity of EV being sold worldwide is increasing greater than the lost market share for Tesla against other mfg.

As for the backlog reducing, it simply means that the production capabilities are catching up so that the preorders are being filled, BEFORE people seek alternatives. It's probably a novel thought for some here but waiting for a vehicle for more than a year is too long for vast majority of the people. Tesla is just aiming to reach an equilibrium.

The best comparison is how Apple's iOS device held large market share and as market share declined due to new entrants, Apple's iPhone and iPad sell through increased. Further, just like Apple, Tesla will be the most profitable EV maker, just as Apple is the most profitable smartphone maker. Tesla margins are 2x~4x of legacy autos. All the talking heads always point to Ford and GM, but in reality, the most productive EV makes are BYD and VW Group, after Tesla.

Tesla energy business is growing rapidly and will accelerate with the infrastructure bill as utility companies transition to renewable energy. Power storage probably will be on par with the EV business over the next decade.

As a side note, I did pick up some RIVN shares today to add to my core position for a trade purposes...

 

[kurtlikevonnegut]

I don't think the market as a whole has respect for how difficult the transition to majority EV production is going to be for legacy automakers and how much of an advantage Rivian and Tesla have in this space.

We are already seeing the start of the friction that transitioning to EVs is causing with organized labor and that will become an albatross for the big 3 over the next decade as the interests of organized labor and the manufacturers are at odds. The cost of adapting ICE manufacturing facilities to EVs will be enormous for the legacy automakers. They also have to deal with the antiquated dealership networks that will have to be slowly weaned off in a painful, expensive way over the next decade.

Yes, the EV space will be getting far more crowded over the next 5 years, but Rivian and Tesla are uniquely suited to maintain comparatively healthy per vehicle margins compared to their legacy counterparts and that ultimately is why they deserve higher market capitalization.

 

[R1Tom]

I'm not one for fundamentals, but Rivian has orders, it has production, it has billions in capital, and it has Jeff Bezos. It must be 3+ years away from any financial woes. Of all the EV startups, Rivian is the only one that's a serious going concern. It's biggest problems come after 2025 as VW, Toyota, GM, Ford, the 100+ EV startups in China, pretty much all auto industry manufacturers and the surrounding industries begin producing EVs in all shapes and sizes at all price points. That's why I think Rivian continues as a niche, "boutique" EV with the R2, never able to scale up to compete with Tesla and Tesla is losing market share while increasing unit production, so it's not keeping ahead of the still nascent EV competitors.
That said, the US EV market will be a very different complexion once BYD, Xpeng and others bring their business to the US. I think it will be analogous to Toyota arriving in the US last century. Hopefully Ford, GM, Chrysler, Rivian and others are well under way with plans to offer vehicles that consumers will want (that offering must include a charging network … we're a year into the $7.5B infrastructure bill and I'm not sure what we're seeing in terms of new charging stations on the ground.)

I agree with all of this. One lingering question for me is why start from ground up on a new plant for R2? I understand that ultimately means doing it right, making it exactly what you need for top efficiency, etc... but.... it also means delaying getting the R2 to market.

It seems to me...something had to be available, that could have been repurchased, in immensely less time.

Time is not on their side....like you said...with everybody and their uncle indicating they are on way to the race....

 

[kurtlikevonnegut]

I agree with all of this. One lingering question for me is why start from ground up on a new plant for R2? I understand that ultimately means doing it right, making it exactly what you need for top efficiency, etc... but.... it also means delaying getting the R2 to market.

It seems to me...something had to be available, that could have been repurchased, in immensely less time.

Time is not on their side....like you said...with everybody and their uncle indicating they are on way to the race....

I think labor availability is a major factor. There seem to have been rumblings that Rivian is struggling to hire enough employees in Normal to cover 2 or 3 full shifts. That's not going to be an issue in North Georgia anywhere near 285.

 

[R1Tom]

I think labor availability is a major factor. There seem to have been rumblings that Rivian is struggling to hire enough employees in Normal to cover 2 or 3 full shifts. That's not going to be an issue in North Georgia anywhere near 285.

That makes sense. I guess my only concern is how far out the endeavor truly makes the R2 platform from becoming a reality and how much the competitive landscape will already be establishing itself.

 

[the long way downunder]

I agree with all of this. One lingering question for me is why start from ground up on a new plant for R2? I understand that ultimately means doing it right, making it exactly what you need for top efficiency, etc... but.... it also means delaying getting the R2 to market.

It seems to me...something had to be available, that could have been repurchased, in immensely less time.

Time is not on their side....like you said...with everybody and their uncle indicating they are on way to the race....

I don't know much more about EV production than what I've read about Tesla or what Munro has published. Munro mentioned that "any auto factory would be useless for EV production." The main problem being the floors would not support the equipment and building construction would not be efficient (I think for the height of robots and moving large sub-assemblies around above the main lines, keeping much larger assemblies moving around where old factory spaces were designed for much smaller sub-assemblies (basically a body arriving from the paint to get bolted to the chassis and everything like engine, trans, instrument panel and axles being the biggest sub-assemblies whereas a state-of-the-art EV would be a front casting, a rear casting weld together, drop onto the battery, drop onto the skateboard … four or six very large assemblies all having to fly around and be staged and synchronized by enormous robots.) The size of the molds and casting presses, the size of the robots, all too heavy for existing floors. By the time you're ripping out the floor, you're into the cost of building a new facility (and a new facility is appealing to regulators with money for a new facility bringing new jobs) … of course there's always the vocal nimby minority to hold up the show … sometimes those voices need to be heard, sometimes like in Georgia, I think they were selfish, unreasonable and near-sighted.

 

[mkg3]

It seems to me...something had to be available, that could have been repurchased, in immensely less time.

Time is not on their side....like you said...with everybody and their uncle indicating they are on way to the race....

Its not clear that there were appropriate empty factory for Rivian to take over.

Consider that GA is offsetting significant cost of starting up the factory, the financial benefit clearly was on their forefront - as it should be.

It is often the case that its lower cost to start a "green field" new factory than to rework/retrofit existing factory with lots of compromises.

It is incredibly difficult to build high volume production vehicles. We're all experiencing the R1 journey. Imagine how much more difficult it would be for Rivian to start and build up R2 at the same time. Even Tesla started from a single Fremont factory before adding others sequentially.

 

[R1Tom]

Its not clear that there were appropriate empty factory for Rivian to take over.

Consider that GA is offsetting significant cost of starting up the factory, the financial benefit clearly was on their forefront - as it should be.

It is often the case that its lower cost to start a "green field" new factory than to rework/retrofit existing factory with lots of compromises.

It is incredibly difficult to build high volume production vehicles. We're all experiencing the R1 journey. Imagine how much more difficult it would be for Rivian to start and build up R2 at the same time. Even Tesla started from a single Fremont factory before adding others sequentially.

Makes sense. Still concerned that comparisons with Tesla won't be relevant when in 2026, every major manufacturer will likely have an R2 price point competitor. Tesla had a nice head start, that Rivian doesn't enjoy. And the others can continue to finance their new R2 endeavors with their incredibly popular and high margin ICE pick-ups and SUV's.

I love idea of state of the art from scratch factory and maybe those efficiencies will be the brilliance that allows competing pricing and acceptable margins.

 

[kizamybute']

OK, tomorrow will be interesting. The question in my Original Post should be clearly answered tomorrow. Rivian met production expectations, which is good and in any normal scenario, would mean an instant spike in stock price. Tesla on the other hand, missed their targets, which would mean a drop in stock price. So, if there are any significant investors out there truly investing in Rivian as a company, tomorrow "SHOULD" be a split day that sees Rivian increase and Tesla decline. Unfortunately, based on past history so far, despite Rivian doing well and deserving a pat on the back for meeting their goals, I fear that we'll see more of the same and Tesla will determine which way the stocks go, up or down. Will be very disappointing to lose money when the company I invested in hit their targets and should be rewarded. I hope this isn't the case and the stock prices go in the direction they deserve to go in, based on the release of quarterly results??

What does everyone think? We going up or down tomorrow?

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