A few years ago, the new American automakers Rivian, Lucid and Fisker were all in the limelight, and the market value of these electric car makers was once in a position to challenge Tesla amid high investor interest. Today's situation is not so optimistic, and at the beginning of 2024, the "life and death reshuffle" of new car-making forces will be staged around the world. Once the success is done, there are always a few who can persist to the end, after all, even Apple has given up the dream of building a car.
At stake. Recently, two of the new American car-making forces that have been expected to catch up with Tesla, Rivian and Lucid, have announced their 2023 financial reports, but the dismal numbers obviously failed to meet people's expectations.
Rivian released data showing that in fiscal year 2023, the company achieved total revenue of 44US$3.4 billion, up 167% year-on-year. However, corporate profitability has not improved significantly, and in fiscal 2023, Rivian's EBIT was -57$3.9 billion, net profit attributable to the parent was -54$3.1 billion, below market expectations. Along with the sluggish performance, there are a series of negative effects such as layoffs, declining orders, and lower stock prices. In terms of personnel, Rivian said that it will cut another 10% of its workforce to maintain the company's operational efficiency.
In this regard, Tesla CEO Elon Musk also said on social **x that according to the current development trajectory, Rivian will go bankrupt within 6 quarters.
Another company, Lucid, is even more precarious, with total revenue falling slightly by 212% for 5$9.5 billion, indicating that the company has not formed an effective business breakthrough. Its profitability has declined dramatically, and in 2023, the company's net profit attributable to the parent will be -28US$2.8 billion, down 11683%。
At the same time, the data also shows that in 2023, Lucid will only deliver 6,001 cars; In 2024, the company's production target is only 9,000 units, which is a far cry from the target of "90,000 units by the end of 2023" set at the beginning of its launch. In the automotive industry, where economies of scale are significant, LUCID cannot form a scale breakthrough or is difficult to achieve a turnaround. Musk said that the only factor for Lucid to survive is the maintenance of Middle Eastern capital.
Another car company, Fisker, has a market capitalization of $2.1 billion from $4.1 billion in 2021$5.8 billion. On March 1, Fisker announced that it would lay off about 15% of its workforce in an effort to conserve cash and seek more financing. The layoffs are primarily related to the shift in sales strategy to a reseller partner model. If Fisker is unable to obtain funding in the future, it may have to reduce its investment in product development and operations. It is reported that the company also plans to reduce the actual floor space and cut other expenses. On the same day, Fisker fell more than 35% after hours.
Downs. The boom of new EV manufacturers in the United States originated from the outbreak of the epidemic in 2020. At that time, in order to save the market, the Federal Reserve lowered the benchmark interest rate to 0-025% and a $700 billion quantitative easing program, with electric vehicles becoming one of the areas with the largest inflow of hot money.
Tesla, as the first stock of electric vehicles, has a share price of more than 650% in 2020, with a market value of $658 billion at the end of that year, surpassing Toyota, Volkswagen, General Motors and other car companies to become the world's most valuable auto company.
In addition to Tesla, at least 20 EV-related companies in the U.S. went public through special purpose acquisition companies (SPACs) that year. Among them, there are two car companies, Lucid and Rivian, the latter is known as the "Tesla killer", and there are many large supporters such as Amazon and Ford standing behind them.
The craze for backdoor listings peaked in November 2021 when Rivian went public. On the first day of listing, Rivian's market value surpassed that of its shareholder Ford, soaring to $150 billion in a short period of time, making it the world's third-largest car company by market value after Tesla and Toyota. However, at this time, Rivian delivered zero external trucks, except for a small number of R1T electric pickup trucks delivered in-house. In Musk's words: "It's a really strange day because a company that doesn't deliver any cars can easily get such a high valuation." ”
Now it seems that it was a turning point for the new American car-making forces. Stephanie Brinley, an analyst at S&P Global Mobility Cars, pointed out that before 2020, the main tone of the U.S. electric vehicle market was to try to launch products first, and then see how the market reacted; After 2020, startups and investors alike began to flock to the U.S. auto industry as policies pushed for the transition to electric vehicles.
However, gradually, when the capital market returns to rationality, these new EV manufacturers who have not yet achieved mass production and delivery in the early stage of listing will obviously not be able to keep up with the pace. Next, the Federal Reserve began to raise interest rates at the fastest pace in 40 years in March 2022, which was very different from the environment in which hot money flowed at that time, and the capital market changed.
Up to now, according to the "American Automotive News" survey of the financial situation of 10 new car manufacturers in the United States, most of them are facing the dilemma of cash flow, and only 4 companies have enough cash on hand to maintain operations for more than a year. In addition, according to the latest documents from the U.S. ** Exchange Commission (SEC), only a few new EV manufacturers can afford to burn cash for more than two years.
Growth crisis. 2024 will be extremely challenging for the new global EV manufacturers, and even Tesla is more conservative in its expectations for 2024. Musk talked about the expectations for 2024 at the earnings conference, clearly mentioning that the growth rate of Tesla's car business in 2024 may be significantly lower than in 2023, because the company is in the middle of two generations of products, the previous wave is the global sales of the Model 3 Y, and the next wave is the global expansion of the next-generation model planned for mass production by the end of 2025. Data shows that in 2024, Tesla's stock price will fall by 20%, and its market value will decrease by about $150 billion.
Even Apple, which plans to sharpen its sword for ten years, has announced that it will shelve and cancel all development plans for self-driving electric vehicles, many members will be transferred to the artificial intelligence department, and employees with strong automotive relevance will be shunted or laid off. In this regard, most people think that the car manufacturing business has a large investment, a long cycle, and fierce competition.
Yan Jinghui, a member of the expert committee of the China Automobile Dealers Association, believes that Apple's choice to withdraw may be affected by a variety of factors, including capital, technical resources, policy environment and the overall environment of the new energy vehicle market. Considering that the development of new energy vehicles has reached a high threshold, Apple may believe that the current environment is not suitable for its long-term development. And this may also be a wake-up call for the new American car-making forces.
In order to save themselves, other new American forces have also set their sights on the Chinese market, trying to become the next "Tesla". In June last year, Fisker announced its official entry into the Chinese market, and Fisker's founder, Henrik Fisker, visited China with a group of executives, and also visited the Lingang New Area in Shanghai and participated in the symposium. You must know that Tesla's Shanghai Gigafactory is in Lingang New Area, and the purpose of Fisker is self-evident.
Industry insiders commented that Fisker is likely to plan to adopt a plan similar to Tesla, build a wholly-owned factory in Shanghai, and move all the production, sales, and after-sales processes of automobiles to China.
However, Jia Xinguang, an automotive expert, pointed out that the financial situation of the above-mentioned new American forces is not optimistic, and it is difficult to support them to enter the Chinese market. Factory construction, recruiting teams, building sales channels, etc. are all significant expenses. For the new US forces, which are currently losing money, I am afraid that they cannot afford it. Even if you do move to China and the cars are produced and sold, you may not be able to sell much.
Yan Jinghui said that it is undeniable that whether it is the acceptance of new energy vehicles or the perfection of the first-class chain system, China is the most suitable market for the development of new energy vehicles. However, China is the most challenging market. Compared to the U.S. market, the Chinese market is more competitive.
Beijing Business Daily reporter Zhao Tianshu.