Factbox: What are EV startups doing to ride out weak demand?
19/06/2024 02:20
(Adds Fisker details)
June 18 (Reuters) - Fisker filed for bankruptcy
protection on Monday, the latest electric-vehicle startup to
succumb to fundraising difficulties, slow sales, as well as
supply chain and distribution challenges.
Demand has been weak for Fisker's flagship Ocean electric
SUV. The company cut jobs and paused investments to slow cash
burn, partnered with dealerships to boost sales and desperately
sought an investment from a major automaker to stay alive. None
of that worked.
Other U.S. EV startups are lowering manufacturing costs,
laying off workforce, and racing to develop cheaper models to
navigate a slump in demand due to steep borrowing costs.
RIVIAN AUTOMOTIVE RIVN.O
Rivian this year shut down its assembly line for weeks to
retool the facility - a move meant to reduce costs and help the
maker of R1S SUVs and R1T pickup trucks turn profitable.
To boost demand and increase efficiency, Rivian recently
announced the second generation of vehicles with new drive
units, upgraded software and fewer parts.
After shying away from cutting the price of its vehicles
last year, Rivian in February introduced lower-range options for
its existing cars.
The startup has focused on reducing its cash burn by
re-negotiating supply contracts and building some components
in-house. Rivian posted cash and cash equivalents of $5.98
billion for the first quarter, compared with $7.86 billion in
the fourth quarter.
In March, Rivian also introduced its smaller, less expensive
electric R2 SUVs and R3 crossovers with plans to start producing
the R2 at its existing U.S. factory to hasten deliveries in the
first half of 2026.
LUCID GROUP LCID.O
Lucid Group said in May it will reduce its workforce in the
United States by 6%. The company has missed analysts'
expectations for revenue for six straight quarters.
It has slashed the price of the Lucid Air Pure and is
including two years of free scheduled maintenance and charging
allowance as an incentive.
Lucid in November unveiled its Gravity SUV that will start
under $80,000 and is expected to go into production late this
year.
To attract a larger customer base, Lucid, backed by Saudi
Arabia's Public Investment Fund, is set to start production of a
more affordable mid-size car in late-2026 with a price point of
around $50,000.
Lucid ended the first quarter with cash and cash-equivalents
of $2.17 billion, compared with $1.37 billion in the fourth
quarter of last year.
NIKOLA NKLA.O
Nikola is pivoting to big rigs powered by hydrogen, after
some of its battery-electric trucks caught fire in August and
forced a recall.
The company expects up to $170 million in truck revenue for
2024 with a target to sell 450 units this year, including its
hydrogen fuel cell electric trucks.
Nikola's cash and cash equivalents at the end of the first
quarter was $345.6 million, down from $464.7 million in
December.
(Reporting by Priyanka.G and Akash Sriram in Bengaluru, and
Abhirup Roy in San Francisco; Editing by Sriraj Kalluvila, Maju
Samuel, and Sayantani Ghosh)
((Priyanka.G@thomsonreuters.com;))