These two electric cars coming to Europe are on the verge of bankruptcy for the manufacturer

Lucid Motors and Rivian, two American makers of electric cars that are just coming to Europe, are also doing badly, very badly. Lucid loses about $377,000 per car sold. Rivian could be bankrupt in less than two years and plans to lay off 10% of its workforce. And yet, new cars are planned, especially for Europe.

Lucid Motors is already present in Europe, with its large Lucid Air sedan, which we were able to test. An electric SUV, called the Gravity, will also hit the road in Europe. Much like its future affordable electric car that should come to supersede the Tesla Model 3. On the Rivian side, it’s more or less the same, with arrivals planned in Europe in the coming months, thanks to its future more affordable R2 series. It will support the existing R1T pickup and R1S SUV.

But will the plan go as planned for the two American automakers? We have big doubts. The two companies have just published their results for the year 2023. And at least we can say it smells burnt!

Lucid: $377,000 lost per car

Let’s start with Lucid, which just dropped the price of its Lucid Air by over 30,000 euros! In the United States, it now starts at $69,900, while the financial statement revealed an average sales price of $90,000 for the fourth quarter of 2024. And Lucid already loses about $377,000 on every car sold. So this figure is expected to worsen in the coming months.

What’s worse is that the American company plans to produce only 9,000 vehicles in 2024. 8,428 were produced in 2023 with 6,001 sold. We better understand the price declines that come with trying to sell stocks in the face of increasingly fierce competition.

In 2023, Lucid achieved a turnover of $595 million, up from $608 million in 2022. Losses were $2.8 billion in 2023 compared to $1.9 million in 2022. In short, things are going very badly.

Elon Musk took advantage of the announcement of these results to speak in his own words, At X (formerly Twitter). According to him, “ Their Saudi sugar daddy is what keeps them alive.” The American billionaire is referring to Saudi Arabia’s Public Investment Fund, which is the majority shareholder of Lucid Motors.

Rivian: 18 months before bankruptcy?

Besides that, Rivian seems to be in almost as good shape as we can see in its results. The company lost “only” $43,372 per electric car sold in the fourth quarter of 2023. compared to about $30,000 in the third quarter of the same year, but $124,000 in the fourth quarter of 2022. So the manufacturer is recovering a bit. , but lives in a very fragile situation.

The company produced 57,232 electric cars in 2023, up 135% from 2022. with 50,122 deliveries to customers. One might think then that Rivian is in a better position than Lucid Motors. But Rivian plans to produce just 57,000 vehicles through 2024, despite the imminent launch of the R2 range, planned specifically for Europe.

In financial terms, turnover reached 4.434 billion dollars in 2023 compared to 1.658 billion in 2022. But losses reached $4.6 billion in 2023 compared to $5.7 billion in 2022. Elon Musk also commented on the situation saying “ The current trajectory will lead to bankruptcy in about six quarters (18 months). Maybe the course will change, but not now“

Lots of layoffs

In an internal email shared by Business Insider, Rivian’s boss announced 10% of the company’s positions, meaning several layoffs. Knowing that Rivian has laid off 6% of its workforce in February 2023 and 6% in July 2022.

Will the future R2T pickup and R2S SUV save the brand? It is possible, as the manufacturer plans a starting price around $40,000. An internal program called Peregrine also plans to drastically reduce the production costs of electric cars.

Musk recalls on X that in 2009, $50 million invested by Daimler (Mercedes-Benz) saved Tesla. A month later, the company would have gone bankrupt without that amount.

So Rivian can still survive, because Amazon is its main investor. Would Jeff Bezos want to take the plunge in the event of imminent bankruptcy? It is possible. Much like Saudi Arabia which wants to protect Lucid Motors and its excellent (but expensive) technologies, the brand’s future awaits more affordable sedans.