If 2021 is the year when the stock prices of the new american car-making forces have risen sharply, then 2022 should be the year of their actual delivery, at least that's how investors bet.
So far this year, a lot of money has poured into electric vehicle stocks Rivian and Lucid Motors, both of which are valued at a staggering $150 billion. But in fact, neither company has stable revenue and has just begun to deliver cars.
The same is true for several other electric vehicle makers, including Canopy, Lordstown Motors and Fisker, which have gone public at extremely low valuations for more than a year and have "promised" to start delivering in 2022 or 2023.
The only company that really has an actual business is Tesla, whose market cap peaked at $1.2 trillion last month.
In terms of consumer choice, in addition to Tesla's four models, traditional car manufacturers also have a number of electric vehicle options, popular choices include Chevrolet Bolt, Nissan Leaf, Ford Mustang Mach-E, Mini Cooper SE and Porsche Taycan. Prices range from about $27,000 to over $150,000.
Considering Tesla's popularity, investors are betting that starting in 2022, the new U.S. car-making forces will need to start large-scale vehicle deliveries. To achieve this, they must deal with supply chain disruptions, labor shortages, inflationary pressures, increasingly competitive markets, and the possibility of rising capital costs.
Vitaly Golomb, a specialist technology investor in electric vehicles at Drake Star Partners, said
The question will be who will start mass production first and be able to translate trends and investments in brands into delivery and customer satisfaction.
This will be the focus of the next phase.
Mass production next year?
At present, the new forces of American car manufacturing have basically not entered the mass production stage.
Just launched last month, Rivian, the maker of electric pickup trucks that has recently gained momentum, is an example. As a company that Amazon holds up to 20% of the shares (with a stake value of $3.8 billion) and Ford, Rivian raised $12 billion, making it one of the largest IPOs in U.S. history.
In terms of actual deliveries, Rivian is a bit "miserable: the company only started production and delivery of vehicles in September; as of the end of October, only 156 pickup trucks R1; for the current order of 71,000 units (pickup R1 + R1S SUV), the company said it will not be completed until the end of 2023.
At the same time, the company continues to lose money: According to Rivian's prospectus documents, the company's operating loss was about $2 billion from the beginning of 2020 to June this year; the company lost as much as $1.23 billion in the third quarter of this year, compared with revenue of about $1 million in the same period; and the company's research and development investment continued, reaching $683 million in research and development expenses in the first half of this year.
Another new car-making force, Lucid, is in a similar state.
Lucid went public through SPAC in July and is currently valued at nearly $64 billion. According to the third quarter report, Lucid's net loss for the quarter reached $524.4 million, compared with a cumulative loss of $1.5 billion in the first nine months of this year. But Lucid said the company has more than $4.8 billion in cash on its balance sheet, and the number of electric car bookings for debuts has now exceeded 17,000, with orders totaling $1.3 billion as of September.
Like Rivian, Lucid only started production in September and began limited delivery of its first electric car to customers on October 31.
But Lucid is "confident" in next year's mass production deliveries: The company plans to deliver about 520 Air Dream luxury electric sedans by the end of the year, and has confirmed a target of 20,000 cars next year; the company also revealed plans to build a second assembly plant in the United States to expand production capacity.
The most optimistic companies are most likely to challenge Tesla. Lucid's current Air Dream Deluxe Electric Car has more than 1,000 horsepower, can travel 837 kilometers on a single charge, and can speed up to 60 miles per hour in 3 seconds. It also features lidar, optical, and radar sensing to help drivers drive on the road and the ability to download over-the-air software updates in the future to enable new features.
Musk poured cold water
However, as a person who has come over, Tesla CEO Musk is obviously not as optimistic as the new forces.
On the occasion of The Divian's listing, Musk said on social media: "Increasing production capacity and breaking even is the real test that the company is facing":
There are already hundreds of automotive startups, including electric and internal combustion engine vehicles, but Tesla is the only U.S. company to have successfully reached production and generated cash flow over the past 100 years.
I want them (Rivian) to achieve high yields and breakeven cash flow. That's the real test.
In short, the new car-making forces must prove that they can do more than just build beautiful websites, showcase presentations, and charge booking fees. They have to make and transport products, and as other traditional automakers switch to electric vehicles, they have to be able to mass-produce them at scale.
Consumers have many choices, and if the production and delivery of the new car-making forces continue to be delayed, the patience of the market may be very limited.