Technology

Elon Musk mocks Tesla rival Rivian after making his blockbuster market debut

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Elon Musk, CEO of Tesla Motors, speaks to the media next to his Model S.

Nora Tam | South China Morning Mail | Getty Images

Tesla CEO Elon Musk said high production and break-even cash flow will be the real test for rival automaker Rivian, which had a blockbuster IPO on Wednesday and is now valued at over $ 100 billion Has.

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

He added, “I hope they are [Rivian] able to achieve high production and balanced cash flow. That’s the real test. “

Rivian, which did not immediately respond to a CNBC request for comment on Musk’s tweets, has never posted revenue and expects third-quarter revenue to be less than $ 1 million.

There are 55,400 pre-orders for the R1S SUV and R1T pickup truck and a contract to build 100,000 electric vans with Amazon by 2030.

But trusting Rivian to assemble the vehicles and deliver them profitably is a huge venture for investors who already value the company higher than traditional auto giants Ford and General Motors.

Despite a lack of revenue, Rivian raised around $ 12 billion on its market debut, making the IPO the largest in the world that year. The IPO also made Rivian the second most valuable automaker in the US after Tesla.

As of the first two days of trading in 2010, Tesla had a market capitalization of just over $ 2 billion. Meanwhile, Rivian CEO RJ Scaringe was worth so much after day two of his business in the public market.

Rivian’s shares rose 57% in the first two days on the Nasdaq. Scaringe, who founded Rivian in 2009, owns 17.6 million shares valued at $ 2.2 billion, based on Thursday’s closing price of $ 122.99.

“We started thinking about the truck, SUV and crossover segments as they presented a tremendous opportunity for us to demonstrate how a clean, technology-driven vehicle could eliminate long-accepted tradeoffs,” wrote Scaringe in the company’s IPO prospectus.

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

Rivian has poached numerous former Tesla employees, including key engineers who helped build the Tesla Model 3.

It’s not the first time Musk has cast shadows on Rivian. Last month he tweeted: “Prototypes are trivial compared to scaling production and supply chain”.

– Additional coverage from Ari Levy.

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