Elon Musk, Tesla's CEO and the outspoken leader of his very own social media platform, X, went on an advice-giving spree yesterday after American EV startups Rivian and Lucid posted their financial results for the fourth quarter and the entirety of 2023.
In short, both Rivian and Lucid are burning through cash. In the case of Rivian, its operating losses have gone down constantly while revenue has gone up in each quarter, but the company is still losing money on every vehicle it sells. It also laying off 10% of its salaried staff.
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Elon Musk the advice-giver
The outspoken and often controversial Elon Musk went on X yesterday to criticize and give advice to Lucid Motors and Rivian after the two companies posted their 2023 earnings reports.
This is far from uncommon in the startup world, and the only solution is to ramp up production and get more people to buy their cars, which–as Elon Musk kindly pointed out in a reply on X–are not bad at all. “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,” said Tesla’s head honcho.
However, Musk predicts that Rivian will run out of money in approximately six quarters if the company doesn’t cut costs massively. Plus, the executives need “to live in the factory or they will die.”
When it comes to Lucid Motors, the latest earnings report mentions the American luxury EV maker plans on building only 9,000 cars in 2024, which is just 500 more than the production guidance for 2023.
The maker of the Air sedan is working on releasing its second model, the Gravity SUV, as well as expanding its AMP-1 factory in Casa Grande, Arizona. The company also has a facility in Saudi Arabia and is owned by an affiliate of the country’s Private Investment Fund.
It’s this affiliation that got Musk’s fingers tingling, writing that Lucid’s “Saudi sugar daddy is the only thing keeping them alive.”
It’s worth mentioning that Peter Rawlinson, the CEO of Lucid, used to work at Tesla during the early Model S days. However, he left the company “before things got tough,” as Musk once said.
Whether you like Musk's comments or not, it’s undeniable that Tesla is now a force to be reckoned with in the EV space. The once-small company grew to become one of the biggest automakers in the world and even managed to put its Model Y crossover on the top spot of last year’s best-selling cars list.
