Starting To See Fault Lines Among EVs -- March 11, 2022

RIVN: down 11% in pre-market trading; says it will cut production in half this year. Mid-morning:

• RIVN: down 7%; trading at $38.
• LUCID: down 6%; trading at $23.
• RIDE: down 6%; trading at $2.
• TSLA: down 4%; trading at $808.
• F: down 1%; trading at $16. This foray into EV's may be incredibly painful in the short term. 

Earnings: speaking of which, how did RIVN's earnings go last night? Link here:

• wider than expected;
• slashed; its 2022 production guidance by half amid growing concerns about supply-chain issues
• to 25,000 vehicles in 2022
• confirmed that Rivian produced only 1,410 vehicles so far in 2022, barely more than they did in 2021;

Rivian: finally the numbers:

• revenue:
• 4Q21: $54 million
• FY21: $55 million
• profit:
• 4Q21: a loss of $383 million
• FY21: a loss of $465 million
• overall net loss:
• 4Q21: a loss of $2.5 billion
• FY21: a loss of $4.7 billion (compared to a loss of moore than $1 billion in 2020)

Rivian: new batteries --

• lithium iron phosphate (LFP) for standard-level vehicles;
• high-nickel for longer-range vehicles (NCA)
• LFP: no nickel, no cobalt; more stable, less energy-dense
• do not deliver same range as NCA
• Tesla also uses LFP for standard battery packs;
  

More and more it looks like US government needs to send windfall profits tax money only to those individuals who will use the check/money to buy EVs.

Ford and PG&E: partners on electric F-150 powering homes, grid. Huge. This is startling. Link to CNBC. For folks like me who thought the concept was a niche concept -- we need to re-think this.

• Ford will collaborate with Pacific Gas and Electric Co. in California to evaluate the capabilities of the electric F-150 Lightning to power homes and return energy to the power grid.
• Ford CEO Jim Farley and PG&E Corp. CEO Patti Poppe announced the plans Thursday night at the CERAWeek energy conference in Texas.
• The F-150 Lightning — due out this spring — already has the capability to power a home in the event of a power outage, according to the company. Ford calls it “Intelligent Backup Power.”
• Three days full power for a home; ten days power for major event; and could probably last longer if absolutely necessary. 
• And, then, of course, taking the F-150 Lightning on the job on a regular basis. No more looking for an outlet at a green-site base.
• my hunch: the military is going to love this; spin-offs:
• huge diesel generators on trucks to re-charge all these electric vehicles. 
  

Crazy prices in Los Angeles, from yesterday: 

For investors, opportunities in oil, an, no, I am not worried about demand destruction:

Opportunities in oil: all the news coming out of Washington (DC) suggests that the price of oil will keep melting up, interrupted by spikes in both directions. These actions are almost guaranteed to keep oil melting up:

• "transitory" inflation
• the Fed raising rates
• safe haven
• windfall profits tax
• releasing oil from the SPR
• US Energy Secretary's complete misunderstanding of energy

Demand destruction: readers know my thoughts on "demand destruction." 

The big question: who is fixated (other than me) on "demand destruction?" I don't know. That's a tricky one. I'm very cynical with regard to memes, metonyms, and nabobs of negativity (LOL -- I have no idea what that means but Spiro Agnew was never given enough credit -- LOL -- but I digress). 

"Demand destruction." This reminds me of a reader who suggested that in the end Russia will do just fine: sure, Russia won't sell as much oil and Russia will have more difficulty selling that oil but at much higher prices, Russia doesn't have to sell as much. [That turned out to be so very, very wrong. But again I digress.]

But when it comes to "demand destruction," this is coming from Wall Street types who don't own cars, work from home, take the subway, have limousines, take Uber, etc., but have so many options. Hellooooo. The rest of America does not have options. Sure, people in Los Angeles will do what they can to save money on gasoline but it's not going to be as much as Wall Street people think. But I do think "demand destruction" is a dog whistle among the Greens to reassure themselves that they're correct and people will need to move away from expensive gasoline to EVs. I don't know; it's complicated, but fascinating.

Too good not to post again. Link here.

I would assume most folks buying gasoline from this station have very few options.