Rivian: Best Of Breed? August 8, 2024

Locator: 48362ARCHIVES.

Initial jobless claims:

• less than expected; labor market healthy
  
• what recession? Markets surge! Well, maybe not surging, but reversed direction and now going up. 
• Steven Liesman: macro-economic desert; data impossible to read 

******************************
EVs

RIVIAN: best of breed. But incredibly lonely.

It's my impression folks think Rivian is a huge EV manufacturer. See scorecard: 

Scorecard 

2024: world's ten largest EV manufacturers. To get on the list, a company needs at least one-half million BEV units delivered annually. PHEVs are fake EVs.

• #1: China, BYD, 3 million
• #2: US, Tesla, 1.8 million
• #3. Germany, VW Group, 0.8 million
• #4. US, GM, 0.5 million
• #9. China, GAC/Polestar, 0.5 million. See update posted today.
  
• NO LONGER LISTED among the top ten: FORD.
• Rivian: 60,000 (one-tenth of what is need to get on top ten list)

************************
Rivian

Link here.

Data points:

Before continuing, important to review a definition:

• CEO: on path to reach positive gross profit by end of 2024. 
• lemonade stands run by 8-year-olds: huge gross profits 
• their moms pay for all materials
  
• facts:
• net loss widened to $1.4 billion, a greater loss than the $1.3 billion expected by Wall Street;
• loss greater than the $1.2 billion a year earlier;
• delivered 13,790 vehicles in 2Q24 (annualized = 55,160)
  
• continues to lose money on every vehicle it sells -- analyst
• lost $32,700 per vehicle sold during it second quarter
• an improvement from the $38,784 per vehicle in first quarter
• so ... LOL ... why did number get better -- the company temporarily shut down its factory in Normal, Illinois in April ... say what ....
• will halt production in Normal, Illinois, for "more than a month" next year to transition to the new R2
• had planned to build the R2 in Georgia but delayed those plans to save money; Georgia plant would have cost $5 billion
• coincidental: VW partnered with Rivian for $5 billion
  
• guidance:
• 57,000 trucks for full years
• a loss of $2.7 billion in adjusted earnings 
• but on path for positive gross profits
  
• ticker:
• the stock is down 30% year-to-date; five-year? down 90%
• last five days: down 16%

***************************
Pickup Trucks

Link here.

From the linked article:

Although traditional automakers have pledged to invest tens of billions of dollars to transition to EVs in the coming decade, they’re making a renewed bet on those large gasoline-powered vehicles that they expected to move away from. The surprising change is in part because consumer demand for EVs has not lived up to expectations, and it is partly because the demand for large gasoline powered trucks and SUVs is keeping prices, and profits, in that part of the market very strong.

A prime example of traditional automakers’ changing views of electric vehicles can be found in the Ford assembly plant in Oakville, Ontario, just outside of Toronto.

Last year, when Ford was negotiating with the Unifor, the union that represents Canadian auto workers, the company promised it would build a new three-row EV at its plant in Oakville, Ontario, starting as soon as 2025. But in April, it hit the brakes on those plans and put the roll-out of the EV model on hold until at least 2027.

“The additional time will allow for the consumer market for three-row EVs to further develop and enable Ford to take advantage of emerging battery technology,” Ford said in a statement at that time. When – and if – it does move ahead with the new three-row EV, it might look to build it at a US or Canadian plant, or it might look to a lower cost factory in Mexico. [There is no emerging battery technology.]

Last month, Ford announced plans for a different vehicle to be built at the Oakville plant in its place: Super Duty trucks, a larger version of Ford’s F-series trucks that remain Ford’s best selling vehicles. Ford said it will build 100,000 of the Super Duty trucks a year in Oakville starting in 2026, even while maintaining production of the trucks at its plants in Kentucky and Ohio.

***************************
Crime Reads

Link here.