Munster: EV Startup Rivian Hasn't Hit Escape Velocity But Could Be 'A Survivor'

Munster: EV Startup Rivian Hasn't Hit Escape Velocity But Could Be 'A Survivor'

Electric vehicle startup Rivian Automotive Inc. RIVN hasn’t yet hit escape velocity, according to venture capitalist Gene Munster.

But the Irvine, California-based company will likely be a survivor in the long term, he says.

Munster, who's slated to speak with Benzinga's Joel Elconin Friday afternoon, provided commentary on the heels of Rivian's second-quarter revenue report, which exceeded market expectations.

The Macro View And Concerns: On Friday, Aug. 12 at 2:30 p.m. EST, join Loup Ventures co-founder Munster and Elconin as they drill down into the details of the earnings season for the technology sector. Here's the link:

Rivian, which maintained the production forecast for the year, trimmed its bottom-line outlook for the full year.

Munster also outlined the difference between Rivian and Tesla Inc. TSLA. At a similar stage in the company’s history, Tesla had $700 million in cash and was potentially going to lose all that, Munster told CNBC.

Rivian’s cash balance is at $15.8 billion, about half of the company’s market capitalization, he noted. He termed this as the powerful part of Rivian’s results.

The company's small workforce is relatively more scalable than other car manufacturers, he added.

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The fund manager noted that preorders rose from 90,000 units in May to 98,000 units, which he termed as only a modest improvement. In comparison, Tesla’s Cybertruck has preorders that could be close to 1.5 million units.

“I still believe that Rivian is going to find their way forward,” Munster said.

Munster also believes Tesla is the clear potential winner in the EV arena, given it has the production and scalability with the Gigafactories.

Rivian stock fell 2.44% to $38 in after-hours trading on Thursday, according to Benzinga Pro data.

Image courtesy of Rivian.

Posted In: electric vehiclesGene MunsterLoup VenturesAnalyst ColorEarningsNewsTop StoriesStartupsAnalyst Ratings