A Lesson in Stonks: Rivian Nosedives as Ford Unloads Shares

Matthew Guy
by Matthew Guy

The fortunes of many are won and lost on America’s stock markets – or even on reports of share sales. Markets reacted this morning to a news report alleging Ford Motor Company is divesting itself of 8 million shares in Rivian, the latter being an EV startup with designs on producing the R1T pickup truck and R1S SUV.

In premarket trading, Rivian’s stock fell over 10 percent to just $25 per share, well off its 52-week high of nearly 180 bucks. Yeesh.

It was reported over the weekend that the Blue Oval is eager to shed 8 million shares of Rivian, representing less than a tenth of its 102 million share stake in the EV company. Something called a ‘stock lockup period’ for early investors such as Ford apparently expired on Sunday, leaving the Glass House free to do with its ownership as it sees fit. It’d seem they want out – or at least partially.

For those of you who slept through economics class, an IPO lock-up is a period of days, typically 90 to 180 days, after an initial public offering during which time shares cannot be sold by company insiders and typically apply to entities like company founders and owners but may also include early investors such as venture capitalists. Ford counts itself in the latter group as far as Rivian is concerned.

One can be forgiven for thinking a tie-up between Ford and Rivian is confusing since both companies are producing all-electric pickup trucks and are essentially in competition with one another. Originally, the two entities spoke at length about a partnership with a three-pronged approach to EVs, at least one of which would have seen Ford use Rivian’s so-called ‘skateboard’ chassis in its own vehicles. As we now know, Ford has made like Fleetwood Mac and gone its own way and started producing the F-150 Lightning, a vehicle on which we will have extensive coverage later this week.

As of this writing, $RIVN is trading at $23.95 per share. Its IPO listing price was $78 in November, making it the sixth biggest in U.S. history and the largest of 2021. It more than doubled in value within seven days before settling in around the $100 mark for the rest of the year. It fell below its IPO price about three weeks later and hasn’t come close to it since. Ford’s own stock is currently worth $13.62 per share.

[Image: Rivian]

Matthew Guy
Matthew Guy

Matthew buys, sells, fixes, & races cars. As a human index of auto & auction knowledge, he is fond of making money and offering loud opinions.

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  • Ltcmgm78 Ltcmgm78 on May 10, 2022

    I’m in favor of letting EVs naturally evolve without government money. Capitalism will pick the winners. It appears that Rivian will collapse under its own weight if they can only produce 25,000 trucks a year.

  • Compelling product, but they aren't really that special. They may have something really special in the pipeline or some super cool technology that I'm unaware of, but it looks like they are just trying to beat Ford at making small pickup trucks. Maybe if they had a three year head start or something it would be viable, maybe there is enough margin and room in that space for a profit. I so hope I'm wrong, but ramping up to compete head to head against a $39K F150 seems crazy.

    • See 4 previous
    • EBFlex EBFlex on May 10, 2022

      @RHD "If they could figure out how to make each chip do the work of two, or five, this problem would be solved." Yes, I've said for the longest time that Ford engineers are astoundingly inept.

  • Jkross22 The contrived, forced, overproduced jokes and antics were fun 15 years ago, but it's been the same thing over and over since. The last few years of Top Gear were heading this direction and the 3 were phoning it in. They should have either done something completely different and tried something new. Instead they played it safe.
  • SCE to AUX "...identified during our rigorous validation process"Not so rigorous, if they ended up on dealer lots. 🙄
  • Ras815 Their naming scheme is almost as idiotic as having a totally separate Polestar brand for EVs that look exactly like...de-badged Volvos. But you can tell it came from the same idiocy.
  • Dukeisduke "The EX naming convention is used for the automaker’s new and upcoming EVs, the EX30 and EX90."Only upcoming when they can figure out the software.