over 1 year ago • 2 mins
EV maker Rivian gave it some gas this week, announcing a quarterly results update that made investors take notice.
What does this mean?
Supply snags have been a pretty unshakeable thorn in the EV industry’s side this year, so investors were probably worried that Rivian’s wound would still be sore to touch. But there was no need to be squeamish: the EV maker made 67% more cars this quarter than the last, with over 7,000 of them passing through the production line this time round. And that wasn’t the only promising number: demand’s fit as a fiddle too, with pre-orders of the firm’s R1 cars climbing a tidy 16%. All in all, then, Rivian posted a smaller-than-expected loss, and doubled down on its full-year production target of 25,000 cars. That optimism was infectious: investors sent the firm’s shares up 7% when the news broke.
Why should I care?
For markets: No one’s taking risks.
Despite that vote of confidence, Rivian’s shares are still down 70% over the last year. Mind you, that makes sense: with interest rates on the up and a recession nearing, investors are seeking safer harbors – you know, like businesses that are actually making money. Rivian’s just not there yet: it has a comfy cash cushion, sure, but it really needs to scale up if it wants to shrink its costs and inch toward making profit. After all, analysts estimate each $81,000 vehicle cost a staggering average of $220,000 to make last quarter.
The bigger picture: Mining drags its heels.
Good news: the International Energy Agency believes that investment in oil extraction is low enough to bring us close to the net-zero pathway. Bad news: the mining sector could slow us down. See, some of the crucial materials needed to make batteries for eco-friendly EVs are in short supply – and the industry’s spending less than half what it did a decade ago on discovering those all-important deposits.
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