BEV Startups Burning Cash and Hopes

Electric-vehicle startups planning on capitalizing on the shift away from internal--combustion engines are experiencing significant cashburn, with one close to folding and another perhaps getting a huge boost from a tech giant.

Rivian and Lucid continued racking up huge losses in the first quarter, while Fisker is wheezing its way through a likely bankruptcy. Rivian, though, already backed by Amazon, could be getting a second tentpole supporting it from Apple.

Rivian’s first-quarter net loss grew to $1.45 billion even as revenue nearly doubled to $1.2 billion, compared with the same period a year earlier. Rivian is gearing up to build delivery vans at its Normal, IL, plant, a vehicle being built for Amazon, but the company is marketing it to other fleet customers as well.

Meanwhile, Apple is believed to be in discussions with Rivian for a partnership following the tech giant’s scuttling of an internal project years in the making that would have had Apple enter the BEV market on its own.

Such a deal would raise Rivian’s name recognition and long-term credibility exponentially. Ford was an early investor in Rivian, holding 12% of the company’s shares, but sold its stake in late 2022 and early 2023 as Rivian’s share price plummeted to remove the overhang on its own share price.

According to one industry source, “Apple is interested, but wary, and is interested to see if Rivian’s culture and operating processes could mesh with its own.” Apple has not been inclined to partner with an old-line automaker after years of often-frustrating collaborations with them around ApplePlay in vehicles from Detroit, Asia and Europe.

Rivian shares are trading under $10 after reaching more than $120 a share in late 2021. The company’s 52-week high is $28.06.

Lucid Group, meanwhile, backed by the Saudi Public Investment Fund, reported wider losses than expected and said it has enough cash on hand to make it through the second quarter of 2025. The company recently received an infusion of $1 billion from the Saudis. The company, which has turned out an impressive model line of Lucid Air sedans, this fall is introducing its first SUV on which it is pinning hopes to push up sales volume and brand awareness.

Lucid reported $173 million in revenues and a $685 million loss in the first quarter. The company expects to produce 12,000 vehicles this year. Lucid shares are down 14% to $2.65 versus a 52-week trading range of $2.29 to $8.37. Lucid stock is down 66% over the past year.

The company says it is developing a more affordable EV to compete directly with Tesla's Model Y with a starting price of less than $50,000.

“We’re already competing with Tesla,” Rawlinson said during the earnings call. “But, wait until our mid-size comes out in late ’26; that’s when we’ll have a car at $48,000-$50,000, and that is the big one, the one that’s going to be really exciting.”

While Rivian and Lucid have deep-pocketed backers willing to finance continued losses for the promise of black ink in future years, Fisker Inc. is struggling to survive with the likelihood of bankruptcy looming. The company is shutting down its Manhattan Beach, CA, headquarters and moving the remaining staff to its La Palma, CA, R&D center. The company was down to $53.9 million cash on hand on April 16.

Fisker already has filed for bankruptcy protection in Austria after contract manufacturer Magna International suspended production of Fisker BEVs at its Graz, Austria, facility.