What happened
Rivian Automotive (RIVN 2.84%) stock jumped out of the gate on Wednesday morning. Shares were higher by as much as 9.4%, and held on to a gain of 7.9% as of 11:15 a.m. ET. Shareholders likely have some of Rivian's peers to thank for the rise.
So what
Rivian didn't have any specific news, but two items of note from competitors has investors liking Rivian more today. Rivian offers luxury, adventure-oriented electric vehicles (EVs). The average price of the more than 20,000 EVs it delivered in 2022 was over $80,000.
Image source: Rivian Automotive.
With another EV start-up unveiling a new luxury electric SUV yesterday, it seems Rivian isn't alone in believing there is a market for those products. Polestar's Polestar 3 SUV will directly compete with Rivian's R1S in the luxury SUV market. It was unveiled in New York City yesterday and has a starting price of $83,900.
Lucid Group is another competitor in the luxury EV market. While its sedans don't directly compete with Rivian's pickup truck and SUV models, it does also cater to wealthy EV shoppers. A Securities and Exchange Commission (SEC) filing yesterday confirmed that Lucid is cutting 18% of its workforce in a bid to save money. That restructuring may have lured some investors into Rivian stock today as it bounces off its all-time low.
Now what
Rivian came up slightly short on its goal to produce 25,000 electric vehicles in 2022. It hopes to double that production volume in 2023.
The company reported an operating loss of $6.9 billion on sales of $1.7 billion for 2022. Rivian had $17 billion in cash and equivalents as of March 31, 2022, but that was down to about $12 billion by the end of the year. So like Lucid, Rivian is focusing on cutting costs.
Today, investors in the sector are favoring Rivian, however, especially as its share price looks to have made at least a near-term bottom.
