It hasn’t been an easy week for Rivian (NASDAQ:RIVN) stock or for the electric vehicle (EV) sector in general. Known for its electric pickup trucks and SUVs, Rivian recently hit an all-time low, dipping below $10 per share. Things look even worse for luxury EV peer Lucid (NASDAQ:LCID), which has shares hovering around the $2 mark.
Today, EV stocks are being negatively impacted by news from an automotive industry leader. Ford (NYSE:F) just announced plans to slash prices on its popular electric pickup trucks and EV players are not reacting well. But while this news is pushing RIVN stock down today, it doesn’t necessarily mean things will get worse for Ford’s newer, cooler rival — or for Lucid, for that matter.
What’s Happening With RIVN Stock?
Despite some volatility, RIVN stock remains in the red today. As of this writing, shares are down 4%. This is in keeping with the stock’s performance over the past month, down 25%. The fact that Rivian finished trading below $10 yesterday is hardly encouraging. But investors shouldn’t instantly interpret Ford’s decision to reduce its electric truck prices as a reason to abandon pure-play EV companies.
That isn’t to say that Ford’s price cuts don’t matter for Rivian and the EV sector. Developments like this often send shockwaves through the market for both large and small companies. We’re seeing that type of scenario play out today, at a time when things aren’t looking good for many EV stocks.
Even after missing production estimates, however, Rivian is still giving investors reason to be optimistic. InvestorPlace contributor Larry Ramer recently flagged the company’s new R2 and R3 EVs as likely growth driving catalysts:
“Both EVs will be able to be charged from 10 capacity to 80% capacity in just 30 minutes and the three-motor versions of the vehicles will be able to accelerate from 0 miles per hour to 60 miles per hour in less than three seconds. Also impressively, “R2 and R3 will provide dramatically enhanced autonomous capabilities” compared with Rivian’s previous offerings, the company reported.”
Ramer added that reservations for the R2 have been high, indicating that consumers are excited by the new vehicle. EV demand may be faltering in general, but that doesn’t mean all EV producers are fully suffering.
The Road Ahead
On days like this, it’s easy to assume that the EV sector is facing a questionable future. But as always, it’s important to examine the news from a macro perspective and not be too quick to assume the worst. Ford’s lower prices don’t mean that the entire EV industry is in trouble. While it’s still unknown how much the price cuts will impact sales, we do know that interest in Rivian’s innovative new models remains high.
Even with RIVN stock hitting an all-time low, investors should stay focused on the company’s growth prospects. This recent losing streak could turn into a key buying opportunity for investors who see potential for the road ahead to smooth out as market conditions shift in the second half of 2024.
On the date of publication, Samuel O’Brient 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.
