Rivian Vs. Tesla When They Crossed $100 Billion Valuations
Rivian is an electric car company that went public on November 10. After pricing its shares at $78 they hit an intra-day high of $179.47 on November 16 and closed at $128.60 on Friday, November 19. It now has just over 891 million shares, which means it has a market cap of almost $115 billion even though it has essentially generated no revenue.
Tesla went public on June 30, 2010, selling shares for $17. It also popped on the first day as it hit a high of $30.40 and closed at $23.85. It had about 92 million shares when it went public, which means its market cap was approximately $2.2 billion vs. the $1.1 trillion it is worth now. It wasn’t until January 2020, almost a decade later and close to 1 million Tesla’s being sold, that crossed into the $100 billion market cap territory.
No current revenue and nothing significant until at least 2023
Rivian has essentially generated no revenue. It has preorders for over 55,400 of its R1T, all-electric pickup, and R1S, seven-passenger SUV, models. Car and Driver magazine describes these two models with prices ranging from around $70,000 to $75,000. These preorders should generate, as long as not too many get cancelled, about $4 billion in revenue.
In an SEC filing Rivian said, “Based on our current production forecast, we expect to fill our preorder backlog of approximately 55,400 R1 vehicles by the end of 2023.” Assuming the bulk of these are built and delivered in 2023 the R1 could generate about $3 billion in revenue in 2023.
For the company’s Electric Delivery Vehicles, which Amazon has preordered 100,000, Rivian said, “We expect to reach a vehicle production rate, which, when annualized, would result in us using 100% of the facility’s current installed capacity of up to 150,000 vehicles by late 2023.” Assuming that Rivian can ramp production to 10,000 by 2023 (probably on the aggressive side) and using a $125,000 price per vehicle, these would generate $1.25 billion in revenue.
This would put Rivian’s 2023 total revenue at $4.25 billion on 50,000 vehicles. Note that it took Tesla three full years of Model S production to hit 50,000 in a year and it had the experience of building the Roadster before the Model S.
As a point of comparison Tesla generated revenue of $3.6 billion in 2014 when it sold over 31,000 Model S’ and $5.3 billion in 2015 when it sold over 50,000 as shown in this graph from CleanTechnica.
$70 billion in 2022 revenue for Tesla
Tesla delivered more than 1,400 of its original Roadster by the end of 2010 and generated $97 million in revenue that year.
For 2019, just before its market cap crossed the $100 billion milestone, Tesla generated almost $25 billion in revenue. It also sold over 367,000 vehicles as shown in this graph from Statista.
For the first nine months of 2021 the company has generated over $36 billion in revenue, is forecast to hit over $50 billion for the full year and $70 billion next year. It looks like it could sell 900,000 units in 2021 and between 1.3 to 1.4 million in 2022.
While Tesla’s market cap is almost ten times larger than Rivian’s, it is on track to easily generate more then ten times Rivian’s revenue and production numbers, which are two years out. And Tesla has shown it can manufacture at scale, while Rivian is not just months but years away from demonstrating it can.