Why Rivian stock fell today

What happened

Shares of Rivian Automotive (NASDAQ: RIVN) fell 15% on Thursday, prompting a drop in the electric carmaker’s share price that began earlier in the week.

So what

Rivian certainly made a splash in his debut on the public market on November 10th. Investors quickly bid on the EV upstart’s shares for a total market value of over $ 150 billion, placing its market value almost as high as that of industry giants. Ford (NYSE: F) and General Motors combined.

But after rising as much as 130% from its $ 78 listed (78IPO) price, Rivian’s stock has fallen more than 30% of its value in recent days.

A downward stock chart.

Image Source: Getty Images.

What now

Rivian has a lot to do for it. Major investors include Ford and Amazon.com (NASDAQ: AMZN), which owns about 12% and 20% of Rivian’s shares, respectively. Even after today’s fall, these stock items are valued at around $ 13 billion and $ 22 billion. It gives Ford and Amazon a lot of incentive to do what they can to boost Rivian’s growth.

Amazon, for its part, has placed an order with Rivian for as many as 100,000 vehicles. The electric vans will be a big part of the e-commerce giant’s efforts to combat climate change.

Still, even with the backing of Ford and Amazon, Rivian’s success cannot be guaranteed. It is likely to face intense competition from rival electric car manufacturers Tesla and Clear, as well as a host of other challengers. Rivian’s equities are therefore likely to remain volatile as investors assess their competitive prospects.

This article represents the opinion of the author, who may disagree with the “official” recommendation position for a Motley Fool premium advisory service. We are motley! Questioning an investment dissertation – even one of our own – helps us all think critically about investing and make decisions that help us become wiser, happier and richer.

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