LCID - Rivian Lucid Fisker And NIO: Not A Compelling Proposition For Shareholders

2024-05-23 18:00:50 ET

Summary

• Tesla continues to lead the EV market with the most competitive vehicles in terms of price, performance, reliability, and access to its Supercharger network, beating any "pure play" EV carmaker.
• Rivian, though somewhat competitive with its product lineup, struggles to keep pace with Tesla's advancements and is far from profitability. The company's long-term viability is questionable in my opinion.
• Lucid follows an outdated strategy, while Fisker warned its own investors about bankruptcy risk, and NIO has a confusing product strategy and limited presence outside China.
• All four companies face significant financial hurdles, including cash burn and the likelihood of shareholder dilution in my opinion. I believe they offer no compelling investing story.

I covered my bull case for Tesla, Inc. ( TSLA ) in a recent article . A few readers reached out, asking if I see any potential upside in other Electric Vehicle ((EV)) carmakers. In this article, I will cover four of the main "pure play" EV automakers — that is, companies exclusively producing EVs. I will particularly focus on Rivian Automotive, Inc. (RIVN), as I believe it has the most potential to compete with Tesla from a product standpoint.

Thesis: The EV car market will be dominated by Tesla and traditional automakers. Rivian and other EV Startups will struggle to survive

Today, Tesla has by far the most competitive EVs in terms of price, performance, reliability and access to a still unique Supercharger network. This is true when compared against traditional automakers, but especially valid when compared to "pure play" EV automakers....

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