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World NewsElon Musk taunts Tesla rival Rivian after its blockbuster market debut

Elon Musk taunts Tesla rival Rivian after its blockbuster market debut

Tesla Motors CEO Elon Musk speaks to the media subsequent to its Model S.

Nora Tam | South China Morning Post | Getty Images

Tesla CEO Elon Musk stated excessive manufacturing and break-even money circulation would be the true check for rival carmaker Rivian, which had a blockbuster IPO on Wednesday and now has a market worth of over $100 billion.

“There have been hundreds of automotive startups, both electric and combustion, but Tesla is [the] only American carmaker to reach high volume production & positive cash flow in past 100 years,” Musk stated in a tweet Thursday.

He added: “I hope they’re [Rivian] able to achieve high production and breakeven cash flow. That is the true test.”

Rivian, which didn’t instantly reply to a CNBC request for touch upon Musk’s tweets, has by no means recorded income and it expects lower than $1 million in gross sales within the third quarter.

It says it has 55,400 pre-orders for its R1S SUV and R1T pickup truck and a contract to construct 100,000 electrical vans with Amazon by 2030.

But trusting Rivian to assemble the autos and ship them profitably represents a large gamble for traders who’re already valuing the corporate increased than conventional auto giants Ford and General Motors.

Despite the shortage of income, Rivian raised round $12 billion in its market debut, making the IPO the most important on this planet this yr. The IPO additionally made Rivian the second most respected automotive producer within the U.S. behind Tesla.

After its first two days of buying and selling in 2010, Tesla had a market cap of simply over $2 billion. Meanwhile, R.J. Scaringe, the CEO of Rivian, was value that a lot on his personal after his firm’s second day on the general public market.

Rivian shares popped 57% of their first two days on the Nasdaq. Scaringe, who based Rivian in 2009, owns 17.6 million shares, valued at $2.2 billion, based mostly on Thursday’s closing inventory value of $122.99.

“We began thinking about the truck, SUV, and crossover segments as they presented a massive opportunity for us to demonstrate how a clean sheet, technology-focused vehicle could eliminate long accepted compromises,” Scaringe wrote within the firm’s IPO prospectus.

“We wanted to establish our brand by delivering a combination of efficiency, on-road performance, off-road capability, functional utility, and product refinement that simply didn’t exist in the market.”

Rivian has poached quite a few former Tesla staff, together with key engineers that helped to construct the Tesla Model 3.

It’s not the primary time Musk has thrown shade at Rivian. Last month he tweeted “prototypes are trivial compared to scaling production and supply chain.” 

— Additional reporting by Ari Levy.

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