The Rivian stock price was valued at over $100 billion after it was publicized at the world's largest IPO in 2021. With this, Tesla CEO Elon Musk has given some warning that Rivian may face.
Rivian Stock Price Prediction: Elon Musk Gives Heads-Up to the Challenges
According to Economic Times, Rivian's stock price has soared as much as 53 percent during its Nasdaq debut on Wednesday, which provided the Amazon-backed electric vehicle manufacturer a market price of more than $100 billion after what could be said as the world's largest IPO this year.
The stock closed at $100.73, gaining roughly 30 percent from its initial public offering price.
With that being stated, Rivian is now the second most valuable automaker in the United States, behind Tesla Inc., which is valued at more than $1 trillion. Rivian scored ahead of General Motors Co. valued at over $86 billion, Ford Motor Co. which is about $77 billion, and Lucid Group with more than $65 billion despite the fact that the company has only begun selling vehicles and has little revenue to report.
The Rivian stock price was way higher compared to Tesla when the electric car manufacturer released its initial public offering at a value price of $1.7 billion. In relation to this, Twitter user @SamTwits critically analyzed the comparison.
When $TSLA IPOed at a value of $1.7 billion they had been selling Roadster for 2 years & had stunned the world with Model S reveal the year before. No criticism of Rivian, but 24 hours into IPO MC is $100B with zero revenue. A sign of the times @elonmusk?— Sam (@SamTwits) November 11, 2021
Surprising the internet community, Musk directly replied to the analysis and stated the true test for its competitor.
"I hope they're able to achieve high production & breakeven cash flow. That is the true test," Musk wrote.
"There have been hundreds of automotive startups, both electric & combustion, but Tesla is only American carmaker to reach high volume production & positive cash flow in past 100 years."
Although the SpaceX founder identified the factors that Rivian will face, the Amazon-backed electric vehicle manufacturer aims to rapidly increase its manufacturing to 150,000 vehicles per year by late 2023 after making only a few hundred so far, per Fortune.
However, some experts believe it will have to boost its output to unsustainable levels in order to justify its current price.
What IS Rivian?
According to Investopedia, Rivian Automotive was created by Robert Scaringe, which is competing against the high-profile electric carmaker Tesla. The business filed for a confidential initial public offering last August 27, which valued the electric vehicle maker at roughly $80 billion.
Moreover, the newly introduced Tesla competitor has two car models for their consumers to choose from, namely the R1S SUV and R1T pickup truck. The R1S has a similarity with the exterior design of the Range Rover, and it competes with Tesla's Model X. Meanwhile, the R1T has a shorter flatbed as compared to Ford's top-selling pickup truck, the Ford 150.
InsideEVs.com reported that the Rivian R1S will provide between 240 and 410 miles of driving between charges, depending on the battery pack used, which is a lot more than the Tesla Model X that only goes 237 to 295 miles. This only means that the biggest threat to Tesla might be the R1S SUV.
As per the website of Rivian, the R1S and R1T will start at $70,000 up to $90,000 for fully loaded variants. In addition to this, the electric car manufacturer claims to have tens of thousands of reservations with a $1,000 deposit per piece.
On the other hand, it is worth noting that Economic Times disclosed that the biggest shareholder of Rivian is Amazon Inc., which is owned by Jeff Bezos. The tech and online retail giant owns 20 percent of the company.