Electric vehicle startup Rivian’s stock plunged to an all-time low Thursday, before falling even further on Friday after Ford Motor Co. released new incentives on its own electric trucks.
Rivian stock closed at $9.20 per share Thursday, before dropping to as low as $9.13 per share Friday. When Rivian went public in 2021, it did so with one of the largest IPOs in U.S. history. But it’s since shed almost 93% of its inital value — and its market capitalization is now just $8.9 billion.
Rivian’s drop comes as Ford slashes prices on some of its 2024 F-150 Lighting electric pickups by as much as $5,500, as first reported by Cars Direct, citing bulletins sent to dealerships. The Detroit automaker has also unveiled its latest “conquest” offer targeted at luring in customers who own other brands.
As of April 3, Ford is offering a $1,500 rebate to consumers who own Teslas and want to purchase a F-150 Lightning. As noted by Cars Direct, Tesla owners could shave off as much as 24% off. the price of a F-150 Lightning XLT through the rebate, a $7,500 federal tax credit, and a separate cash incentive.
“Reports of Ford reducing prices for the F-150 Lightning EV are sending shockwaves through the EV market, particularly affecting Rivian and Lucid,” Bloomberg Intelligence analyst Steve Man noted, according to Fortune. “Both startups are facing challenges that could be exacerbated by another round of EV price cuts, potentially eroding their profit margins and cash reserves at a time when they need to conserve cash.”
As EVs continue to cost more than their gas-guzzling alternatives, automakers — both in the U.S. and abroad, especially in China — have been relying on price cuts and incentives to attract interest. Ford saw sales of its Mustang Mach-E crossover boom in the first quarter after it introduced incentives of up to $8,100 on 2023 models.
Ford sold 7,743 electric F-150 Lightning trucks in the first quarter, an 80% increase compared to 4,291 units sold a year earlier, but down from the prior quarter. In January, the automaker slashed production of the electric pickup.
Rivian delivered 13,588 electric vehicles during the first quarter of 2023, down slightly from the fourth quarter of 2023. Rivian lost $5.4 billion last year and expects to lose another $2.7 billion in 2024, even as it continues with its “company-wide cost transformation program.”
The Irvine, California-based company is betting on three new EVs — the R2, R3, and R3X crossover SUVs — to keep investors interested and enthusiastic about the company. Rivian’s facility in Normal, Illinois, is undergoing renovations this week that are expected to improve production by 30%; CEO RJ Scaringe announced on April 3 that Rivian had produced its 100,000th vehicle.