U.S. electric vehicle startups, which roared last year, are struggling with supply chain chaos and rising raw material prices. The Wall Street Journal reported on the 7th (local time) that contrary to investors’ expectations, it is difficult to expect a rebound like Tesla (NAS:TSLA).
Electric vehicle startups such as RIVN (NAS:RIVN) and Lucid (NAS:LCID) succeeded in attracting billions of dollars in investment last year.
Livian raised $12 billion in IPO in November last year, the largest IPO since 2014. Lucid was listed last year through a merger and acquisition of SPAC. At that time, the merger was $4.4 billion, the largest for a SPAC merger.
The stock prices of the two companies are disastrous, unlike in the early days of listing. Libyan shares have fallen 68 percent this year and Lucid has fallen 62 percent.
Investors are expecting a rebound, just as Tesla was also pushed to the brink of bank bankruptcy and revived with the success of Model 3.
Tesla CEO Elon Musk recalled on Twitter that by the time the Model 3 was released, the company could have been forced into bank bankruptcy in a month. However, the success of Model 3 and Model Y SUV, which followed, revived.
According to Motor Intelligence, an industrial data provider, the two electric vehicles accounted for 60 percent of U.S. electric vehicle sales in the first eight months of this year.
This allowed Tesla to sell more than $3 billion in carbon emissions to existing car manufacturers that did not have noticeable electric vehicles in 2020 and 2021.
The journal explained that Livian and Lucid are hard to expect such a rebound.
Charles Mann, a senior analyst at Columbia Threadneedle Investment, said, “Tesla had a theme that existing car manufacturers did not have. And it has been possible to raise capital for a long time, he said. “This topic was based on the indifference of existing car manufacturers, but it is no longer so.”
Livian produced 7,000 electric vehicles in the first half of this year, and it needs to double its production speed in the second half to meet its production target of 25,000 units this year. This year’s production target is also a halving of the previously proposed target.
Lucid also sharply lowered its production target for this year. Last month, Lucid reduced its production target of its luxury electric vehicle sedan Lucid Air from 20,000 to 6,000 to 7,000.