Lucid is losing money, Rivian is losing money, Tesla is treading water in China, but at least the Italians are trying to make an EV.
Welcome to The Morning Dump, bite-sized stories corralled into a single article for your morning perusal. If your morning coffee’s working a little too well, pull up a throne and have a gander at the best of the rest of yesterday.
Lucid Lost $670 Million Last Quarter
Lucid Group, maker of the slippery Lucid Air electric sedan, posted up some big numbers this quarter. On the revenue front, it pulled in $196 million, which trounces the $232,000 it made in the same quarter in 2021. The other big number? A net loss of $670 million, per Automotive News. Making cars is hard.
The numbers are extra bleak because, as Automotive News notes, Lucid now says it’ll meet its production goals despite supply chain issues. That’s a good thing, right? Well, not when the big goal is to produce 6,000 to 7,000 cars. “The automaker’s original production goal for 2022 was 20,000 vehicles,” writes the news site.
The same Automotive News piece has a quote from the company’s CEO sort of explaining what’s going on:
Lucid CEO Peter Rawlinson said on Tuesday’s earnings call that the automaker continues to struggle with supply-chain issues but expects to meet its 2022 production guidance despite the challenges.
“In fact,” Rawlinson said, “even now we are experiencing a challenge with one particular item that will lead to a very temporary timeout for the [production] line.” Rawlinson did not name the item in short supply but said the downtime would be used to implement changes that would ultimately increase production.
That isn’t at all crpytic.
At the moment Lucid only has the one car and, according to the company, about 34,000 total reservations. An upcoming SUV, the Gravity, is going to debut next week before the LA Auto Show.
Rivian Expected To Lose About $1.7 Billion, With A ‘B’
Electric truckmaker Rivian is poised to announce big numbers today as well, but those big numbers will be of the negative variety. In Q2 of this year the company posted a loss of $1.7 billion. What’s the guess for this quarter? According to analysts it’s about $1.7 billion. From Automotive News:
When the automaker reports third-quarter earnings on Wednesday after the market close, financial analysts are expecting revenue of about $552 million on improving deliveries of its adventure vehicles, but also another net loss similar to Rivian’s $1.7 billion loss in the second quarter.
This doesn’t mean the trucks aren’t good. By most accounts, the trucks are very good. The engineering that goes into them is also impressive. [Editor’s Note: If you want to read the most detailed, tech-heavy review of the R1T, check mine out. It’s a great truck. -DT]. It’s extremely tough out there for established OEMs with longstanding supply chains and Rivian is ramping up a new car and a new brand out of thin air. Making cars is hard.
If there’s good news for Rivian it’s that the company’s Electric delivery vans are being delivered to Amazon as expected. As Electrek reports:
According to Amazon’s latest update, the Rivian EDV rollout is progressing as planned, with over 1,000 fully electric delivery vans debuting in more than 100 US cities this holiday season. A few of the newest cities you may be able to spot one of these EDVs in are Boston, New York, Las Vegas, and Pittsburgh.
Has anyone seen one on their neighborhood?
Tesla Trying To Woo Chinese Buyers As Musk Sells Stock
Yes.
In the (hopefully unlikely) event that Twitter forces this deal to close *and* some equity partners don’t come through, it is important to avoid an emergency sale of Tesla stock.
— Elon Musk (@elonmusk) August 10, 2022
Tesla is the most established of all electric automaker startups [Editor’s Note: I think we ca stop calling it that now. -DT] and even it’s having some issues, particularly in China where deliveries have been on a roller coaster ride and competition has gotten stiffer.
To try to compete in China it looks like Tesla aims to give people a break on their insurance. I’ll let Reuters explain how this works:
The U.S. automaker previously offered an insurance incentive of 7,000 yuan ($970) for orders between Oct. 1 and Dec. 30. But on Tuesday Tesla said the incentive for November was raised to 8,000 yuan and reduced for December orders to 4,000 yuan.
“As long as you like it enough, pick up Tesla immediately!” Tesla said in its official Weibo account when announcing the policy change.
The insurance incentive is a cash rebate offered to buyers to buy insurance from Tesla’s partner insurers.
Tesla having more competition is clearly good for buyers, though a little challenging for Elon Musk. The CEO of Tesla and now Twitter appears to have told people in August that he was done selling shares; now it’s November and, per CNBC, he just sold $3.95 billion worth of shares. I hope he got an insurance discount.
I Like This Weird Italian EV SUV
AEHRA (pronounced:¯\_(ツ)_/¯) is a new Italian startup that’s aiming to sell a ginormous electric SUV that they call… the AEHRA SUV. The Milan-based company has Fillippo Perini as their chief designer officer and he’s got a legit resume, but there are some bonkers details in their press release about the design and basically no details about how the car is being built or powered or range so I’m just going to quote the press release:
Every single element of the SUV personifies AHERA’s unwavering determination to defy modern, mass-market automotive convention, while holding steadfast to the pure values of classic Italian design. This sentiment is instantly evident in aspects such as the glassware, which appears to flow as a single piece from the very front of the car and over the roof, before sweeping down to the rear of the tailgate in an almost liquid-like fashion. It is also dramatically expressed in the stunning elytra-like doors. Opening skywards and providing optimum ease of entrance and egress to the exceptionally spacious cabin that effortlessly accommodates four NBA-size players in complete comfort, such features are normally the exclusive preserve of supercars.
I think I know where they’re getting at (it has funky doors), but the idea of four NBA-size players in a supercar is funny to me. Here’s a quote from Perini:
“With the AEHRA SUV, we have shunned the conservative constraints that have encumbered all other car manufacturers in their approach to designing EV vehicles to date.”
Really? Someone show this dude a photo of the Cadillac Celestiq.
As with all EV startups that only have renders assume it isn’t real until they actually sell one.
The Flush
Which EV car company will be the biggest EV car company in a decade: Rivian, Lucid, Tesla, or AEHRA? If you said “Tesla” then tell me how many times bigger Tesla will be than all of the others combined.
So, tough question: Do we think Rivian will definitely survive?
Are they out of the woods yet?
I like their trucks but at this point I have a hard time believing they will ever make a profit.
Unlikely they will survive. They loose a ton of money on each vehicle they sell. There is a reason that Ford quickly dropped the plans to build a vehicle on their platform, they figured out there wouldn’t be any profit in such a vehicle and that of course was also why the sold off a lot of their stock.
Answer: Rivian (Looks better)
The truth? None- I hope there’s no EV’S at all- FORCED on everyone w/o a say (especially wish Tesla would cease to exist) & hope that there are real cars w/ real engines- beautiful rolling works of art everywhere (like 1930’s-50’s automobiles, 1960’s/70’s muscle cars, & even some of the good one’s through 80’s, 90’s & 00’s…after that all new cars suck
I believe the largest EV company will be a Chinese firm that partners with an established brand. With all my heart I think Mr. Musk will tire of electric vehicles and devote his energies to SpaceX. He’ll sell Tesla to GM or Ford.
I think it’s going to be BYD, their buses go past my house every few minutes and even their cars are outselling Tesla in China now.
Hot Take: Rivian makes perfect mid size off road adventure machines. I just want Stellantis to buy them, slap a 7 slot grill on the front, and call it the Jeep EV.
“Which EV car company will be the biggest EV car company in a decade: Rivian, Lucid, Tesla, or AEHRA?”
That’s easy… the answer is Tesla. They have a huge head start, they are self-sustaining from a profit perspective and they have the production capacity… not just for assembling vehicles, but for a lot of other stuff that supports vehicle assembly like a sufficient battery cell supply.
The other 3 companies are nowhere near breaking even… and won’t any time soon. And there is a good chance that one or two of them will go insolvent at some point.
Yeah, I’ve been seeing the Rivian Amazon delivery vans for a month or two here in the greater Nashville metro area. I think it’s just been the EDV 500 in my neighborhood, but it might have been a 700, not totally sure. They look good!
It can fit 4 NBA players:
Mugsy Bogues
Spud Webb
Nate Robinson
Earl Boykins
There are a couple Rivians roaming the streets around me. They look pretty darn good, but that price tag…
Has anyone seen one on their neighborhood? yep, just on Monday actually.
the biggest EV manufacturer in 10 years will probably be Kia as long as the dictaturd to the north of them does not set off a nuke.
Biggest in 10 years….Walmart. $8998 not-great but not terrible Chinese made EV with a warranty that last for as long as you finance it, includes insurance and free charging at Walmart. At some point American is going to run out of affordable 3rd/4th owners cars and there is a large population of drivers that don’t have the money to buy/fix anything better.
I cant tell if you’re joking or not, but essentially you’re right.
Eventually cheap used ICE cars will dry up.People have to get something!
I think that Tesla will still be on top in 10 years, and it’s not because of what their CEO will say / won’t say. It’s because they have a better handle on how to make EV’s. They own their battery IP, they’ve proven they can scale batteries better than anyone else, they’re doing some really interesting stuff with construction (the castings are a huge advance in cost reduction), they have a better geographical dispersion than their fellow “start ups” and they don’t have to deal with a legacy dealer network. They are also making way more per vehicle than anyone else is, so they have more room to get into a price war, and the have the flexibility to retool design if they need to.
No matter what you think about the CEO, they’re executing pretty well.
“On the revenue front, it pulled in $196 million, which trounces the $232,000 it made in the same quarter in 2021. The other big number? A net loss of $670 million, per Automotive News. Making cars is hard.”
I’m not worried about Lucid. They’ll stick it out. They have a huge amount of runway (capital,) they have experienced auto people, they keep demonstrating wisdom in handling shortages (using forced downtime to retool,) and they’re keeping very strongly to their niche with first-mover advantage and no competition. They’re also making smart, realistic adjustments to the business plan based on that. And cutting production with better amortization of costs is a smart move.
And they really have no competition. Idiots compare Lucid on the basis of ‘it’s an EV,’ which is like comparing a Ferrari to a Hyundai because ‘they have a 6 speed transmission.’ Lucid is $150k+ sub-$300k ultra-luxe; until Maybach announces theirs? There’s nobody else in that space.
“Electric truckmaker Rivian is poised to announce big numbers today as well, but those big numbers will be of the negative variety. In Q2 of this year the company posted a loss of $1.7 billion. What’s the guess for this quarter? According to analysts it’s about $1.7 billion.”
And here we have an example of a company that is completely and utterly fucked. Rivian could post a $1.7B loss when they were, you know, not actually selling or delivering vehicles. And now they’ve revealed that none of them – not a one – had a fucking clue what they were doing. Deliveries up 67% from Q2 to Q3, of just 6,584 units. Including all R1T, R1S, and EDV700.
Competition? They are beyond fucked. Ford, FCAtlantis, and GM have announced or launched competing cars, they’re shipping more of them, and they’re cheaper than Rivian. They also have the familiarity advantage. Truck buyers want familiar. The F150 Lightning sold 1,837 units in a single month, because “it’s a Ford truck! Just like the Ford truck you’re trading in! But with batteries.” That sells. Being able to touch the vehicle on a dealer lot? That also sells.
I expect extreme downsizing of the company and expectations to happen soon, especially as they’re failing to meet contractual delivery obligations for Amazon. They’ll have to stop high margin R1T/R1S to meet low margin EDV700. (Especially since Amazon owns enough of the company to force it.)
“[Tesla is] having some issues, particularly in China where deliveries have been on a roller coaster ride and competition has gotten stiffer.”
Also, because the Chinese government doesn’t like foreign automakers, and Tesla least of all. Jeep pulled out because the government was basically going to make it untenable. Everyone has pulled way back and gone back to severely restricting IP. Tesla got too big for Winnie the Pooh, and keeps trying to thumb their nose at him. And buyers saw the absolutely horrific abuse Muskovite inflicted on the employees during lockdowns. The government made sure of that.
The roller coaster ain’t got much track left.
“AEHRA (pronounced:¯\_(ツ)_/¯) is a new Italian startup that’s aiming to sell a ginormous electric SUV that they call… the AEHRA SUV. “
It’s pronounced ‘I have a tiny penis and far more money than intelligence.’
Glad I could help clear that up.
Which EV car company will be the biggest EV car company in a decade: Rivian, Lucid, Tesla, or AEHRA?
Toss-up between Rivian and Lucid.
Rivian might make it as a vocational builder, and there’s obviously a lot of money in that. Frank Klein shows that’s the way they’re being forced to lean. See also their JV with Daimler in Europe to build a vocational van factory. But they need to fire Scaringe and hire more Kleins, or they are not going to survive.
Lucid has really taken ownership of their niche, but it’s a very small TAM. Again: look at a Lucid as you would a Maybach. It’s not a Rolls Royce, but it’s above a Mercedes. People buying Lucids don’t have anything to cross-shop, and that’s not going to change significantly. They won’t be losing a significant number of $150-185k sales to Rolls ($450k+) or Cadillac ($300k+.) But the margins are extremely healthy, especially if they can get long amortization.
Lucid has always felt like it was run by grownups, in contrast to almost every other EV startup. I won’t claim to have any idea how this is going to shake out in the long term, but they’re the one I’m rooting for most.
It’s been interesting to watch Munro tear down the Rivian on their YouTube channel. There seems to be a lot of weirdly expensive design mistakes. On most cars they’re pointing out shortcuts that had to be taken for budget or time reasons, on the Rivian they’re often pointing out excessively complex parts that required a lot of engineering time and are expensive to produce, but don’t seem to provide any meaningful benefit over a much simpler option. It’s almost like Rivian is a German carmaker. 😉
Lucid is $150k+ sub-$300k ultra-luxe; until Maybach announces theirs? There’s nobody else in that space.
Isn’t that Cadillac flagship EV also in the monopoly money range?
What if someone from China buys Tesla?
Ol’ Musky is going to be too volatile for the board and his Twitter boondoggle if going to see him sell off a healthy amount of stock. Tesla itself has valuable IP and an established presence basically everywhere. If I was a Chinese billionaire I’d be snapping it up.
Out of the choices given, I’d expect Tesla to be the biggest EV maker in a decade. I’m pulling for Lucid because I like what I’ve seen out of them. However they’re still in the stage – like all the choices up there that aren’t Tesla – that it will be very easy for them to succumb to the sheer difficulty of making cars. As has been said here and by some German Lighting deal for a while: Making cars is hard!
EV company? Some Chinese EV company that will go for volume instead of boutique EV’s like the vast majority of them right now. Someone will figure out that NHTSA standards aren’t awfully different than NCAP and make a model to meet both with minimal changes.
Doubtful it will be Tesla since Musk seems bound and determined to alienate anyone but those people who agree with him in lockstep. Unless they can delink themselves from him, that is.
I haven’t seen a Rivian Amazon truck moving under its own power, but they seem to be shipping them far more frequently than the trucks, based on my unscientific viewing of semi payloads. (Plant is an hour north of me.)
Part of that is no doubt that they send car carriers of pickups, but all the Amazon vans I’ve seen are lone flatbed riders, which seems inefficient. Early on the pickups would ship with 1 or 2 on a 13 spot truck, so maybe they’re still in ramp up mode on the vans too.
If we’re just looking at domestic production I’ll give the nod to Tesla in a decade, but worldwide it’s going to be whichever Chinese company rules the roost.
I’ve seen about a half dozen Rivian Amazon trucks out on the roads on their own. Even got a picture of one on the freeway because I was happy to see them out there and wanted to show a friend.
I have yet to see an Amazon truck (at least one that I’ve noticed) but have seen roughly ten R1Ts on the road and 1 R1S in the parking lot at work.
I recently saw my first Lucid in the wild a couple of weekends ago.
But since I rarely have a commute where I don’t see at least three Teslas, I think Rivian and especially Lucid are unlikely to ever catch up to Tesla.
I just saw my second Rivian on the road this week. I also saw my first Bright Drop in the wild yesterday. Interestingly it was across the street from Amazon HQ and it was not set up for door to door delivery as it has a rail style liftgate and they were using to move some office furniture/fixtures. It was wearing a MI plate but was mostly just white except for the front doors, fenders and hood which were black. No logos on the driver’s clothes that I could see.
A legacy manufacturer is going to be the biggest EV manufacturer in 10 years, and here’s my hot take of all hot takes: Mercedes is about to make a big dent in Tesla’s sales. A massive portion of Tesla sales are due to clout chasing/conspicuous consumption. For a long time they’ve essentially been the only EV game on the “I’m looking to flex on the peasants” front…and despite good competition from brands like Kia and Hyundai, they don’t carry the same brand cache that Tesla does.
…but do you know who has a century worth of brand cache? Mercedes Benz, and they have an entire range of EVs trickling out. The three pointed star means something to a lot of people, and if Tesla continues to lag on updating their cars I think the conspicuous consumption crowd is going to matriculate that way.
“A legacy manufacturer is going to be the biggest EV manufacturer in 10 years,” agree 100%
Teslas look old, and owning one isn’t remotely a flex anymore. The Roadster and Cybertruck are still vaporware, but even if they weren’t, they’re just two more big-dollar niche machines.
I expect *every* brand will beat Tesla to the punch with affordable EV models, and will be unsurprised if Musk immolates himself with bad decisions and public buffoonery. “Oh well.”
The only issue I have with the legacy automakers is that they do not have a dedicated charging infrastructure. If you drive your Hummer H1 from SF to LA good luck on getting to all the DC fast chargers in working order. Between San Jose and Santa Clarita, on a route using highway 5, Tesla has 361 chargers and Electrify America has 24.
This is a really good point. Tesla’s biggest competitive advantage is that they have the largest and most reliable charging network. Even if other manufacturers are making superior cars, at least for a while Tesla is still going to have a leg up on the infrastructure side.
This could be the reason why they’re dragging their feet on the announced opening of their charging network to other makes. In the short term it’s a competitive advantage, but in the long term going all-makes is the only way it can ever be an independent profit center.
Or it could just be Elon’s habit of announcing things by tweet before the engineers and hardware crews have the chance to even start figuring out how to make it happen.
Given that it seems that every German luxury automaker’s EV offering are priced to the stratosphere, I don’t think they will be the ones that eat Tesla’s lunch. It more likely to be GM. Their up and coming EVs are not only better looking and will have a better fit and finish but are priced at competitive levels. Tesla doesn’t really make luxury cars. They instead were early in the EV game and were considered novel only because they were about the only choice if you wanted such a vehicle. Other then that there isn’t anything remarkable about them. They are almost boring in comparison to just about anything being offered by the major automakers.
I _really_ like what I’ve seen of the EQS. If I had six figures to drop on an EV right now that’s probably the way I’d go.
I’d go Taycan since I’m a shameless Porsche fanboy, but it’s clear Benz has done their homework on the EQ products. I personally would find them frustrating due to the fact that everything is screen controlled and there aren’t any buttons…but the type of person who wants a high end EV right now is looking for tech on tech on tech, so I get why they’ve gone in that direction.
Are you seeing something in actually functioning chargers that don’t belong to Tesla I’m not? The cars are loosing their competitive edge, but the charging network is still unchallenged. Incentives to build chargers might eventually shift to incentives to actually deliver charges to cars. That could help. Ten years though? Tesla will be ten times any of the listed three, and the legacy manufacturers will be close to Tesla if infrastructure starts hockey stick inflection right quick.
I think these start ups building cheaper EVs is a fools errand, they need high margin vehicles to survive.
Lucid should skip building a sub $80K car. In ten years Tesla will probably be the biggest because they have bottomless pockets of cash, and existing market share. How much bigger? well they might be the last ones standing. Making cars is hard.
I think Nikola and Lordstown will be in solid competition…
Okay, I don’t actually have a serious answer, though I suspect the legacy automakers may successfully pivot and eat up a lot of market share. The EV landscape will probably look a lot different in ten years.