EV Start-Ups Dip Amid Stock Sell-Off

January 24, 2022 1:33 PM EST
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Several electric vehicle start-ups dipped during intra-day trading Monday to 52-week or record lows as many investors seek safer investments amid a broader market sell-off. Rivian (NASDAQ: RIVN), Lordstown Motors (NASDAQ: RIDE), Faraday Future (NASDAQ: FFIE), NIO (NYSE: NIO), Canoo (NASDAQ: COEV), Nikola Corp. (NASDAQ: NKLA), and Electric Last Mile Solutions (NASDAQ: ELMS) all dropped by at least 10%.

Shares of more established automakers such as Tesla (NASDAQ: TSLA), General Motors (NYSE: GM) and Ford Motor (NYSE: F) were down by between roughly 7% and 9% during midday trading.

“In this brutal market sell off, the Street has tossed many of these EV startups into the sell camp as the lack of profitability, chip shortage issues, and host of production issues have cast a dark shadow over the sector,” Wedbush Securities analyst Dan Ives told CNBC in an email. “In this risk off market, EV startups find themselves on the wrong side of this market storm with now execution is key to build back credibility on the Street one brick at a time.”

Shares of Rivian, which is among the most-watched EV start-up, dropped below $60 a share Monday for the first time since the company’s IPO in November.

The Dow Jones Industrial Average lost over 1,000 points at one point Monday, or 2.9%, falling for a seventh straight day. The market sell-off comes as investors worry about rising inflation and interest rates and await corporate earnings results.

By Michael Elkins | [email protected]

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