For investors, the sense of gloom has been building since October, when Tesla Inc. warned of sagging interest in EVs. Though shares of the EV giant have fared poorly since then, losing around 20% and massively underperforming the broader market, the impact on smaller rivals like Rivian and Lucid has been nothing short of disastrous.
There was a time when the backing of some of the world’s deepest pockets and the mere ambition to sell electric cars was enough to inspire confidence in the stocks of upstarts Rivian Automotive and Lucid Group. Now investors have all but thrown in the towel on the shares.
All it took was a fresh dose of reality from the two companies this week around cooling demand for EVs. Rivian, which makes electric pickups, SUVs and delivery vans and counts Amazon.com as its top shareholder, said its production will stay flat at last year’s levels. It also announced plans to shrink its workforce again. Lucid, majority-owned by Saudi Arabia’s sovereign wealth fund, projected only a slight increase in output over 2023. Both forecasts fell far short of analysts’ expectations.
