In a recent appearance at a Donald Trump rally in Pennsylvania, Tesla CEO Elon Musk addressed the possibility of acquiring Rivian Automotive, a fellow electric vehicle (EV) manufacturer. When asked about a potential Tesla-Rivian merger, Musk simply stated, “I wish them the best. I hope they do well.” He further emphasized the immense challenges faced by the car industry, noting that only Ford and Tesla have survived bankruptcy in the United States. Musk believes Rivian’s success hinges on navigating these challenges, and his remarks suggest an acquisition isn’t on the horizon.
Musk’s comments highlight his view that Rivian’s future remains uncertain, particularly given the intense competition within the EV sector. Rivian has gained traction with its electric pickup trucks, finding a receptive market. However, the company faces significant financial hurdles, struggling to balance production with profitability. Rivian is actively working to improve production efficiency and reduce costs, anticipating the release of its R2 vehicle in 2026. A joint venture with Volkswagen is also providing financial support, with up to $5 billion committed to Rivian.
This isn’t the first time Musk has expressed pessimism about Rivian’s prospects. In February 2024, he predicted that Rivian might face bankruptcy within six quarters. He has also raised doubts about Volkswagen’s ability to fully invest the $5 billion promised to Rivian. With a market capitalization of $10 billion, Rivian’s acquisition by the larger Tesla is theoretically possible, but Musk’s statements indicate that such a move is not under consideration. Instead, he seems content to observe the competition struggle, believing they will eventually face financial difficulties.
Despite the challenges, Rivian remains a significant player in the EV landscape. The company’s focus on production efficiency, cost optimization, and the upcoming R2 vehicle release could potentially help it overcome its current financial difficulties. However, Musk’s assessment highlights the ongoing struggle for survival in the intensely competitive EV market.