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Elon Musk sees Rivian and Lucid bankrupt again as RJ Scaringe uses his own interest rate excuse

The R1T electric pickup (image: Rivian)
The R1T electric pickup (image: Rivian)
The only thing keeping Lucid afloat is, according to Tesla's CEO Elon Musk, its 'Saudi sugar daddy.' As for even, he says they might be bankrupt a few quarters from now.

Elon Musk is again predicting bad times for Tesla's rivals Rivian and Lucid. Commenting on Rivian's earnings, he said that they will be bankrupt six quarters from now if they keep bleeding money like that. As for Lucid, Elon had only "their Saudi sugar daddy is the only thing keeping them alive" to say.

Rivian's CEO RJ Scaringe, on the other hand, used Elon Musk's own high interest rates excuse for the company's sales slowdown. He essentially blamed the Fed-created market conditions for the layoffs in Rivian's workforce:

Our business is not immune to existing economic and geopolitical uncertainties, most notably the impact of historically high interest rates, which has negatively impacted demand.

Back in 2021, however, when Rivian stock was still riding high as interest rates were low, Elon warned him that "our primary challenge is affordability." "Creating an expensive truck is relatively easy. If [affordability] is extremely hard to do for Tesla, despite our much greater economies of scale & better technology, then it is damn near impossible for others," he added at the time.

After seeing Rivian's latest quarterly financials that saw its stock price slump 25% in a day, Elon Musk again advised that the electric truck maker would "need to cut costs massively and the exec team needs to live in the factory or they will die."

Their product design is not bad, but the actual hard part of making a car company work is achieving volume production with positive cash flow.

RJ Scaringe remains bullish on electric car prospects in the longer term, though, and says that the upcoming R2 truck will change Rivian's fortunes.

There is a lack of choice of highly compelling EV products in that $45,000 to $55,000 price range, recognizing the average price of a new vehicle transaction was around $48,000. We remain very bullish on the R2 segment and the R2 product itself.

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> Expert Reviews and News on Laptops, Smartphones and Tech Innovations > News > News Archive > Newsarchive 2024 02 > Elon Musk sees Rivian and Lucid bankrupt again as RJ Scaringe uses his own interest rate excuse
Daniel Zlatev, 2024-02-23 (Update: 2024-02-23)