Rivian (NASDAQ:RIVN) is among the worst-performing large-cap electric vehicle (EV) makers in the market this year. On a year-to-date basis, RIVN stock is down nearly 50% at the time of writing. This decline includes today’s rally, which sees Rivian’s stock price more than 5% higher as of early afternoon trading.
Much of this downside momentum has to do with factors outside of Rivian’s control. The interest rate environment is not conducive to solid EV adoption trends. And with Rivian’s premium-priced models seeing less demand, price cuts and deteriorating margins are affecting most EV makers across the board. On top of this setup, Rivian has had its own set of production issues, which have hampered its stock price.
However, today, there is some positive news to report for Rivian. The company just shattered a record set for the so-called “race to the clouds,” the Pike’s Peak International Hill Climb. Let’s dive into Rivian’s performance and why the stock may be up on this intriguing news.
RIVN Stock Climbs on Product Superiority
For years, the Pike’s Peak International Hill Climb has been dominated by EVs due in part to the thin air at these elevations (starting at 9,390 feet above sea level and finishing at 14,110 feet above sea level). Gas-powered engines don’t perform as well, and given the innovation we’ve seen in terms of product design for many EVs, this is a race that many view as a test of how high-performance off-road EVs will do.
Rivian’s R1T Ascend Quad Max traversed up this 7%-plus grade with ease, being the previous record set by Rivian last year for production trucks, eclipsing the previous record by more than 30 seconds. That’s a massive beat and suggests the newer Rivian models are better than ever in terms of performance.
If Rivian’s goal is to differentiate the company by quality, these sorts of events are important showcases of the design and improvements that the Rivian team is putting forward. Indeed, from a quality standpoint, there’s a lot to like about the Rivian brand. We’ll have to see how this translates into future sales, but where I live, I’m seeing a lot more Rivian trucks than other EV trucks, likely due in part to this reality.
On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
