Whether you’re a die-hard electric car fan or just curious about the EV market, you’ve probably thought about the companies — not named. Tesla — it might be a good idea to buck your horse now.
We’re still starting to transition from petroleum-powered cars to electric cars, but I’m excited about it. Rivian‘s (NASDAQ: RIVN) EV pickup truck and SUV, so much so that I bought shares of the company earlier this year. Here are three reasons I think it might be one of the best EV stocks to put $500 toward.
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During the summer, the second largest automaker, Volkswagenstarted a partnership with Rivian where VW will have access to some of its tech. In exchange, the EV maker received an initial $1 billion and will increase to $5.8 billion in planned investments by 2027.
It’s not only a good investment for the company as it burns through the costs of expensive car production, but it’s also a sign that Rivian is developing an important technology that the car industry is taking notice of.
And the VW investment is not the only important support from the big company. Amazon he was the first investor and owns about 17% of the company. It has also ordered 100,000 electric vans from Rivian for delivery by 2030, with 10 already delivered.
Car manufacturing is difficult and expensive, and that’s true for EV start-ups. Rivian and many of its competitors are burning cash as they launch new products and try to ramp up production. But despite spending more, Rivian is reducing its losses.
The company’s loss was $1.1 billion in the third quarter (which ended Sept. 30), an improvement from its loss of $1.37 billion in the previous year.
Some of Rivian’s cost reductions this year included redesigning some of the wiring in its vehicles, removing 100 steps from battery manufacturing, and removing 500 parts from the production of the R1S SUV and R1T truck, all resulting in a 35% cost reduction.
The difference between Rivian and its peers is that the company is moving closer to profitability. Management recently reiterated that it will achieve a modest profit at the end of the fourth quarter.
If you believe that EVs are the future of the automotive market, then now is a good time to invest. Many EV stocks, including Rivian, have experienced declining stock prices over the past few years.
