Rivian was very successful while he is trying to build a long -profitable electric vehicle company.
Despite the important steps, Rivian remains mired in red ink.
Rivian faces the competition today that Tesla did not have to face.
10 actions that we love better than Rivian Automotive ›
After Tesla(Nasdaq: tsla) proved that an electric starting car agency could face traditional car manufacturers, Wall Street has entered the action. This is where Rivian(Nasdaq: Rivn) came to public, to a lot of fanfare. Quick advance from a few years to the current day, and the Rivian stock price fell 90% of its peaks from all time. Is it a diamond in the harsh that could transform you into a millionaire in a story of Tesla style success, or should you have more modest expectations?
To grant a credit where credit is due, Rivian has obtained a huge success in a very short time. It has mainly passed from an idea – manufacturing electric vehicles (EV) – to an operating company with a respected EV truck and an EV delivery van widely used by Retail Powerhouse Amazon(Nasdaq: Amzn). It was not something that could have been done if Rivian did not have his act together.
Image source: Rivian.
In particular, at the end of 2024, Rivian crossed a key step, making a modest gross profit for the first time. Although a gross profit only means that he has been able to generate more income from the sale of his vehicles than to produce them, it is a key step towards positive income.
The modest gross profit occurred after Rivian reached another important objective, production on a scale. It delivered more than 10,000 vehicles in the second quarter of 2025, which is a substantial number. He also has a new truck called the R2 which will be released next year, which will be focused on the mass market. This should help further increase the volume, which will allow Rivian to distribute its costs over even more vehicles.
In many ways, Rivian follows the traces of Tesla. Given the progression of the massive action price that Tesla made on its history, some investors could see Rivian as a second chance to catch a little of Tesla’s opportunity that they could have missed. Do not be too excited.
With a highly respected product and key partners such as the Amazon technological giant and the automaker Volkswagen (which agreed to provide new capital to Rivian according to Rivian’s ability to achieve certain commercial objectives), Rivian seems to be established as a lasting company. However, this objective is still likely to be in at least a few years, given the need to invest in business and research and development at the moment. Rivian could help you achieve seven -digit net value, but it is not likely to do so quickly.
In addition, the competition that is today is much greater than when Tesla has entered the automotive market. At the time, Tesla was essentially the only company to make electric vehicles. Today, there are a number of major electric vehicle manufacturers. Almost all traditional car manufacturers are also in space. Even if Rivian succeeds, he could still produce a modest profit at the bottom of his income statement, thanks to the modified competitive landscape.
That said, even this result would require strong execution. Although Rivian has lived up to its objectives, for the most part, so far, there is no guarantee that it will continue to do it in the future. If the company begins to miss its objectives, investors should become deeply negative about action.
How many negatives could they obtain after a drop in prices of 90%? Well, the action happens to be up almost 23% in the past year, which is significantly better than the gain of almost 17% of the S&P 500 hint (Snpindex: ^ GSPC). Even after a drop of 90% +, there is still space for a deep withdrawal, because investors seem to have a price in many good news in recent days.
It would probably not be a great idea to bet your house on Rivian. But he achieved a lot in a short time, with an important opportunity for more success in the future. The problem is that it could also fail its objectives and flame itself, as many manufacturers of electric vehicles have already done so. If you see the execution force and want to add Rivian to a diverse portfolio, this could help you achieve millionaire status. Just go to recognize the risk, which is important and the period you need to consider, which is long.
This is why more conservative investors will probably want to sit on the sidelines for the moment. This is very logical to wait at least until the R2 is put on the market, so that investors can assess the way the new car with consumers.
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Reuben Gregg Brewer has no position in the actions mentioned. The Motley Fool has positions and recommends Amazon and Tesla. The Motley Fool recommends Volkswagen AG. The Motley Fool has a policy of disclosure.
Is Rivian Stock your ticket to become a millionaire? was initially published by the Motley Fool
