Rivian (RIVN) stock pops after new analyst sees ‘credible path’ for the EV maker to breakeven
After Rivian (RIVN) stock earned a big buy rating on Tuesday, shares traded up nearly 9% as investors look for the EV maker to break even. A new analyst sees at least 50% upside for Rivian’s stock price with a “credible path” to breakeven gross margins.
Rivian has a “credible path” to breakeven: Analyst
On Tuesday, Guggenheim analyst Ronald Jewsikow initiated a buy rating for Rivian stock, setting an $18 price target.
In a note to investors, Jewsikow said, “We see a credible path to breakeven gross margins” in Q4 2024.
The comments mirror those of Rivian’s CEO, RJ Scaringe. After a planned shutdown at its Normal, IL plant in April, Scaringe said the company “introduced a dramatic cost reduction in material costs.”
During a factory visit this week, Rivian told Reuters that upgrades earlier this year resulted in a 35% material cost reduction for its vans. The latest upgrades have savings of a “similar magnitude” for its R1S and R1T models.
Rivian has cut out 100 steps from the battery-making process, 52 pieces of equipment from the body shop, and over 500 parts from the design.
The path to profitability
Rivian’s gross vehicle margins have improved drastically over the years. After losing $139,277 for every vehicle built in Q3 2022, Rivian lost around $39,000 per EV in the first three months of 2024.
Although that number is down from the over $43,000 loss per vehicle in Q4 2023, it’s still up from the $32,600 and $30,500 loss in Q2 and Q3 2023, respectively.
| Q3 ’22 | Q4 ’22 | Q1 ’23 | Q2 ’23 | Q3 ’23 | Q4 ’23 | Q1 ’24 | |
| Rivian loss per vehicle | $139,277 | $124,162 | $67,329 | $32,594 | $30,500 | $43,372 | $38,784 |
Rivian is projecting its first positive gross profit in the fourth quarter of this year. Jewsikow sees Rivian’s recent plant upgrades and supplier negotiations as key to reaching positive gross profit.
After 2024, Jewskikow expects Rivian to generate positive EBITDA (earnings before interest, taxes, depreciation, and amortization) in 2026 when Rivian launches its next-gen EVs.
Rivian revealed the smaller, more affordable R2 in March, which will start at $45,000. The R2 is expected to greatly expand Rivian’s market after it earned over 68,000 reservations in under 24 hours.
The R2 will be made in Normal, starting in early 2026. Although production was initially planned to begin at its new Georgia facility, the move saves $2.25 billion and will get R2 on the market quicker.
Rivian’s R2 is expected to account for 155,000 of the 215,000 future annual capacity at the plant.
Rivian stock was up nearly 9% on Tuesday following the news. Rivian’s shares are still down 43% in 2024 and 11% over the past 12 months.
Update: Rivian stock surges after hours following an announcement that Volkswagen will invest up to $5 billion into Rivian to form a joint venture for next-gen EVs
Source: Barrons
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Joseph Lubin, co-founder of Ethereum and CEO of blockchain firm ConsenSys.
Riccardo Savi | Getty Images for Concordia Summit
Crypto firm Consensys has been added to the SEC’s list of targets, as the regulator continues its industrywide crackdown.
The SEC on Friday sued Consensys in federal court in Brooklyn over allegations that the company “engaged in the offer and sale of securities” and “acted as an unregistered broker” through its digital asset wallet called MetaMask.
“Consensys violated the federal securities laws by failing to register as a broker and failing to register the offer and sale of certain securities,” the court filing alleges.
In April, Consensys, which provides blockchain software, tried to preempt the SEC’s action with its own lawsuit, alleging overreach on the part of the regulator. The 10-year-old company said its suit followed three subpoenas issued last year, plus a Wells notice from the SEC that claimed Consensys was violating federal securities laws.
So far this year, the SEC has sent Wells notices, filed lawsuits, or reached settlements with a host of crypto firms focused on ethereum and decentralized finance, including ShapeShift, TradeStation and Uniswap. The agency is also reportedly investigating the Ethereum Foundation.
Less than two weeks ago, Consensys declared victory in its fight with the SEC.
“The Enforcement Division of the SEC responded by notifying us that it is closing its investigation into Ethereum 2.0 and will not pursue an enforcement action against Consensys,” the company wrote in a statement on June 18.
Consensys said in an emailed statement that the action is part of an “anti-crypto agenda” at the SEC.
“This is just the latest example of its regulatory overreach — a transparent attempt to redefine well-established legal standards and expand the SEC’s jurisdiction via lawsuit,” the company said. “We are confident in our position that the SEC has not been granted authority to regulate software interfaces like MetaMask.”
As it looks to close the gap with Tesla and other EV tech leaders, Toyota is set to unveil its first EV with an advanced self-driving system. Toyota’s joint venture, GAC Toyota, confirmed it’s launching an EV with Tesla Full Self Drive-like capabilities next year in China.
Toyota to release first “full” self-driving EV next year
GAC Toyota is a 50:50 joint venture between Toyota Motor and China’s Guangzhou Automobile Group (GAC).
The news was announced this week on GAC Toyota’s social media as it looks to close the technology gap with rivals like Tesla, XPeng, BYD, NIO, and others in the region.
Toyota’s JV will launch the Bozhi 3X SUV next year as the first EV model to feature the self-driving tech. It will enable advanced driver-assist features like driving on roads, avoiding obstacles, and parking (similar to Tesla’s FSD).
The tech stems from a new partnership with Momenta, an autonomous vehicle startup in Beijing. Toyota was among the lead investors during Momenta’s 2021 Series C financing.
GAC Toyota is also working with Huawei to use its tech in Toyota’s bZ3X electric sedan, according to CnEVPost. The bZ3X was revealed in October 2022 as the second EV to join its lineup behind the bZ4X.
The new tech is unique from Huawei’s in that Momenta and Huawei will provide software and hardware while the three work together to integrate it.
Toyota also revealed it plans to release an iron phosphate lithium battery by 2027 that could cut production costs by 40% (compared to the current bZ4X).
After car sales dropped 22% in China during the first four months of 2024, Toyota is looking to revamp the brand with new, more competitive tech.
Toyota is taking another page from Tesla with plans to open the previously exclusive Lexus charging stations in Japan to other EVs. The Japanese auto giant looks to fend off incoming competition from low-cost Chinese EV makers like BYD, which launched its third EV in Japan last week.
Source: Reuters, GAC Toyota
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A Tesla Semi was spotted driving on the highway with a sensor array on top of the vehicle. The automaker has long been quiet about the autonomous driving capacity of its commercial trucks.
At Tesla’s annual shareholders meeting earlier this month, CEO Elon Musk said that he approved Tesla’s long-delayed plan to bring the Tesla Semi class 8 electric truck to volume production.
After the original unveiling of the Tesla Semi in 2017, Tesla has refrained from talking too much about the vehicle’s autonomous driving capabilities.
But Tesla has always claimed that all its vehicles produced since 2016 are equipped with all the hardware necessary to achieve self-driving through software updates and the Tesla Semi was seen sporting cameras all around the vehicle.
Now, a Tesla Semi vehicle was spotted with a new array of sensors on top:
The sensors do look like lidar sensors:
Tesla doesn’t use lidar sensors for its autonomous driving system, but it has used lidars for validation or “ground truthing” of its own systems.
This is likely what is happening here, which makes it interesting as it could imply development on Tesla deploying its supervised autonomous driving systems to its class 8 electric truck.
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