Main Facts
Rivian announced on Tuesday that it had delivered 13,972 vehicles in the fourth quarter of 2023, which is below analysts’ expectations of 14,000 vehicles, according to FactSet.
Rivian’s shares fell by nearly 10% on Tuesday morning, marking its largest daily drop since November 9, when it also fell by nearly 10%.
On the other hand, Tesla announced it delivered 484,000 vehicles, a record number, exceeding market estimates of about 473,000 vehicles, and ended the year achieving its goal of delivering 1.8 million vehicles.
Tesla’s shares rose by 0.6% in pre-market trading on Tuesday morning and were slightly up before 11 AM.
Analysts in a Wedbush report indicated that Tesla’s numbers were a “clear victory” for CEO Elon Musk and the company, as achieving the delivery target was a “significant accomplishment in the electric vehicle market amid tough economic conditions.”
However, not all news was good for Tesla on Tuesday, as a Chinese electric vehicle manufacturer named BYD announced it outpaced Tesla in the number of vehicles delivered for the first time in the fourth quarter of 2023, although Tesla still surpassed BYD in the total number of vehicles delivered throughout the year.
Main Background
These figures were released amid concerns about declining demand in the electric vehicle industry, resulting from rising interest rates affecting consumers’ purchasing power for electric cars. Increased competition in the market, including from Tesla’s new Cybertruck, and the ongoing price war with Chinese electric vehicle manufacturers, have created a challenging environment for electric vehicle makers. Changes in electric vehicle tax credit rules also began to take effect on January 1, rendering many vehicles, including the Cybertruck, ineligible for tax credits, which may increase challenges to the purchasing power of electric vehicles. In October, Rivian’s shares dropped following news of an anticipated early bond issuance, raising concerns about the company’s financial health. However, CEO RJ Scaringe addressed these fears, stating to Reuters that the issuance was aimed at strengthening the company’s financial position before borrowing becomes more expensive.
What We Don’t Know
Tesla’s data released on Tuesday did not provide details on deliveries and production of its new Cybertruck, leaving unclear how the new vehicle has performed since its debut in November amid recent reports of production difficulties.
What to Watch For
Rivian will release its financial results for the fourth quarter and the full year on February 21 after market close, while Tesla will release its financial results on January 24.
In-Depth Reading
For more information, you can read the following article: “Elon Musk boasts that the Cybertruck is endurant at the live delivery event” by Zachary Folk.
Leave a Reply