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Why?? Because a company that will eventually need capital to grow is accessing capital markets. I just don’t understand the pessimism.
Rivian still has a bumpy few years ahead. They have enough cash through 2025 according to the last investor's call.
I was thinking about this too. I wonder if they're trying to average out the market in chunks over the next two years as a hedge.
Why? Production is way under original projections.
Most of what happens with R1 production will have limited impact on Rivian’s long term potential. For example I saw an interesting stat yesterday, 96% of Tesla’s sales are M3 and MY. Long term I expect R1 should only account for similar volumes for Rivian the rest being R2 and RDV a similar sentiment to what @Scoiatael said above.
Ambulance chasing attorneys can always find a reason to sue. That’s what they do. Rivian wouldn’t have much trouble beating that unless it was proven they lied about how much cash they actually have. They could easily say they were honest in the earnings call about having enough to get through 2024 and that clearly isn’t enough to do what they need to do long term. All of those can be true.
Yes, Tesla could stop building the S/X and it would have little impact.
I agree at least with respect to Lucid. It’s ludicrous they have a higher market cap than Rivian. Luxury sedans are not nearly as compelling than any of Rivians products IMO and their runway isn’t Nearly as long. Don’t know much about Fisker other than Magna is building their product and it’s In a more budget friendly segment.
That statement was in the context of well into the future. Not 7 days after the earnings call. I fully expected Rivian to offer secondary and debt as we go along.
They certainly will. Expect more bond issues and equity raises. This does not mean they are a bad company as even Fortune 500 companies tap the capital markets. They'll be figuring out what the 'right' capital structure for them is over time. Ideally they start reducing down big chunky owner & early investor equity stakes and bring in more institutional money.
I'd be more concerned if they weren't. Is it early? Maybe, but it's not like the capital suddenly appears overnight with these things.
Looks like this is getting to be a final lifeline for them. I'm not sure how they survive longer term. They'll have to rely on the economy being just right, that is rates stop rising and start to fall. But more then likely either rates stay high because inflation or rates drop because the economy is slowing quickly and unemployment rises. On top of all of this, is more competition from automakers that are in better positions financially.
