I've been paying attention to Rivian (RIVN) and I'm holding for the long term. Historical performance has been poor, they IPO'd way over valued to raise funds, but what they're doing is expensive. It's no news that they're hemorrhaging money, citing a loss of $40,000 per vehicle sold (down from $67,000 last year). But in the last 3 months they've had some very promising announcements.
During the recent investor day webinar they talked about how Gen 1 was all about proof of concept, but now they're moving onto Gen 2 which is about manufacturing efficiency. They detailed how they reduced components, steps and fasteners to decrease production and assembly costs. It all sounds very good. In addition they just entered a deal with VW for $5 Billion and all Rivian is supplying to VW is software. It's a stepped plan, $1B up front and additional investments based on performance.
If they reduce manufacturing costs as they predict, and lower sale price as they promised, I'm thinking this stock could be ripe for big growth. They're the only company competing directly with Tesla, and on the consumer side, it's going well. I doubt we'll ever see a RIVN selling at comparable prices to TSLA, but I could see them over $100 in a few years if they continue to make advancements.
Thoughts?
I'm in at $11/share.
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