Tuesday's Market Minute: Global EV Players Stalling After Quarterly Earnings

Softness in some of the major global EVs is persisting amid earnings that aren’t able to match the sky-high bar. But the numbers have been relatively solid. Tesla TSLA has slid about 6% since the start of a lackluster August, still holding well above its 200-day simple moving average but teetering on its 50-day moving average. Weakness in Monday’s session was attributed to the company’s long-time CFO Zach Kirkhorn departing the company after nearly 13 years at the EV maker. Tesla CEO Elon Musk weighed in on the departure, stating on his X social platform, “I would like to thank Zach Kirkhorn for his many contributions to Tesla over the course of often difficult years… 13 years is a long tour of duty. Zach will spend time with friends & family, then do something else.” 

Li Auto LI reported its second quarter update Tuesday morning, posting sales growth of 228% on a year-over-year basis, which beat the Street’s forecasts at $3.95B. Vehicle sales also increased a whopping 230% to $3.86B, while total deliveries increased 201.6% to roughly 86,500 units. Perhaps even more significant was the increasing cash on hand for the Chinese EV player, which now stands at $1.5B, up 884% from year-ago levels. Heading into Tuesday’s numbers, Li Auto shares have risen 129% so far this year – making it one of the best-performing EV players in 2023. XPeng XPEV has risen 88% in the same period, and Nio (NIO) is up 52%.

On the domestic front, Lucid Group LCID remains one of the worst performers – sliding over 6% YTD through Monday’s close. The company reported its second quarter financials after the close on Monday, posting a top and bottom line miss and ending the quarter with $6.25B in total liquidity. The company said it raised $3B in the second quarter, including $1.8B from the Public Investment Fund. Lucid said its current liquidity is expected to cover production for the Lucid Gravity and into 2025. They also stated the company is on track to achieve their 2023 production target of more than 10,000 vehicles, but recognize they still have work to grow their customer base. Aston Martin also selected the company’s technology for powertrain and battery systems, with contracts totaling over $450M. Shares have also been sluggish to start the month, down about 16%.

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