Tuesday was a good day to be an investor in quite a wide range of electric vehicle (EV) companies. Many of them, no matter what kind of EVs they develop and sell, saw notable rises on the day.
But that’s what often happens when one member of the group posts encouraging news. With that foot on the acceleration pedal, pickup and SUV specialist Rivian Automotive (NASDAQ: RIVN) rose nearly 9% in price, while high-sticker price vehicle makers Fisker (NYSE: FSR) and Lucid (NASDAQ: LCID) both increased by around the 3% mark.
The peer with the happy headlines was Chinese EV company BYD (OTC: BYDDY). Late on Monday, the busy automaker released its latest set of quarterly results, and they impressed many. Its profit for the first half of this year leaped nearly 205% higher compared to the same period of 2022. This was accompanied by a very healthy 73% rise in revenue and a new all-time high for monthly sales in July.
Rivian, Fisker, and Lucid are American EV makers, so their fortunes and the environment they operate in are not directly comparable to BYD.
That being said, the outsized gains of the Chinese company indicate that demand for EVs continues to be extremely strong — even in a big economy that is currently undergoing a host of challenges and struggles. Additionally, BYD is motoring along in spite of intensifying price competition.
And if Chinese consumers, facing potentially significant economic hardship, are still enthusiastic about EVs, surely would-be American buyers are even more eager and numerous. Concerns about inflation in this country are fading, and many macroeconomic indicators continue to look good. This portends well for our domestic EV segment.
It also implies there is more than enough room for niche EV makers, a description that applies to Rivian, Fisker, and Lucid. Rivian successfully rolled out its R1T in late 2021, making it the first mover in the EV pickup space; it’s now added to that product lineup with the R1S SUV. Fisker’s Ocean is a state-of-the-art SUV, meanwhile, while Lucid’s sleek Air Pure sedans will set a customer back at least $82,400.
EVs are still expensive products, however, and many longtime auto consumers haven’t quite accepted the viability and the value proposition of such vehicles. On top of that, as specialists in particular types of automobiles, Rivian, Fisker, and Lucid all have to work that much harder to convince buyers to part with great sums of money to buy their creations.
Still, the BYD fundamentals were shockingly good. The global EV market continues to roar ahead, and optimism is in the air with companies making next-generation vehicles.
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