Musk’s first thoughts on new electric car makers came in response to the Tesla bull Honest warren, who posted an image highlighting that Lucid and Rivian have yet to deliver a legitimate production vehicle to customers. This is in stark contrast to what happened to Tesla, as the company had already shipped around 1,400 Roadsters before it went public on June 29, 2010 at $ 17 per share.Documents filed by Rivian revealed that the company is looking to get a valuation of around $ 80 billion when it goes public. This is quite significant considering that the only deliveries of the R1T pickup truck that have been reported so far were to company employees. A recent report by Bloomberg noted that Rivian is looking to focus its deliveries this year on its Amazon electric delivery van, which would likely result in very conservative R1T deliveries in the near future.
Lucid is somewhat on the same boat, as the company went public without first delivering its highly anticipated Air luxury sedan. So far, Lucid has said he plans to start Air deliveries in late October. However, Lucid does not plan to produce 577 Air sedans until 2021, according to a Forbes report.
Commenting on the valuation of Lucid and Rivian, Elon Musk added that “(Is it) possible to start an electric vehicle business without shipping cars and get a valuation of less than a billion dollars!” In a subsequent Twitter post, Musk shared more of his thoughts. According to the CEO of Tesla, he hopes that newcomers to the electric vehicle sphere have a high tolerance for pain, as increased production, supply chain management, logistics and service are important issues. “World of suffering”.
This isn’t the first time Elon Musk has issued a warning about the challenges of mass production. During the Q2 2021 earnings call, Musk reiterated those thoughts while describing how difficult it was to ramp up production of Tesla’s 4,680 battery cells. Musk noted that in the case of the 4680 batteries, producing them as a prototype was incredibly easy, but increasing their production to a significant level was a whole different beast.
“Limited production is easy, prototype production is easy, but high volume production is difficult. Transitioning from some sort of small-scale production to high-volume production presents a number of challenges, ”Musk said. Given Tesla’s experiences with “production hell” during the Model 3’s ramp-up, future EV makers like Rivian and Lucid would be wise to take Musk’s warnings and advice on notice.
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