Electric-Vehicle Sector Faces Selloff as Tesla Stock Hits Low

by Warren Seah

Shares of electric-vehicle makers were hit hard on Tuesday, as Tesla Inc.’s stock reached a six-week low. Tesla’s stock dropped 0.9% in morning trading, marking a third consecutive loss and the lowest close since July 26.

The dip in stock price came after the sudden departure of Chief Financial Officer Zachary Kirkhorn, adding to investor anxiety following news of an investigation into steering problems. Since Tesla reported its second-quarter results at the end of July, the stock has fallen 14.4%.

Other companies in the sector also experienced declines. Nikola Corp. saw its shares sink 4%, with a plunge of 32.2% since the company reduced its 2023 revenue and truck delivery guidance on August 4.

The Global X Autonomous & Electric Vehicles exchange-traded fund (DRIV) also took a hit, dropping 2% to a five-week low. The ETF has experienced a six-day losing streak, falling 6.9% since reaching a 16-month high of $27.76 on July 31.

Meanwhile, Workhorse Group Inc. saw its shares tumble 8.1% to a one-month low after reporting a narrower-than-expected second-quarter loss but falling short on revenue forecasts. The Ohio-based company also slashed its full-year revenue guidance.

Although the electric-vehicle sector faced significant declines, not all EV stocks experienced losses.

Rivian Automotive Inc. Anticipates Second-Quarter Results

Rivian Automotive Inc. (RIVN) is preparing to reveal its second-quarter results following Tuesday’s closing bell. Despite a recent dip, the company’s stock managed to recover by 0.7% from a three-week low. Rivian has generally outperformed expectations in terms of losses over the past five quarters; however, revenue projections have fallen short in the previous three quarters.

Mullen Automotive Inc. Implements Strategic Changes

Mullen Automotive Inc. (MULN) experienced a positive shift as its shares rose by 3.1% after reaching a five-week low on Monday. This development followed the announcement of a reverse stock split of one-for-nine and a $25 million stock-repurchase program.

Lucid Group Inc. Demonstrates Promising Stock Performance

Lucid Group Inc. (LCID) displayed an encouraging increase in stock value, with an impressive rally of 5.4%. The California-based company reaffirmed its commitment to meeting its full-year production target, despite second-quarter revenue falling short of forecasts.

Fisker Inc. Experiences Minor Setback

Fisker Inc. (FSR) encountered a slight setback as its shares declined by 1.4%. Although the company surpassed bottom-line expectations, it fell short in terms of revenue and production, which was reported last week. Similarly, shares of Lion Electric Co. (LEV) experienced a 1.1% decrease.

Chinese EV Market Faces Challenges

The overall weakness in the sector was reflected in the performance of China-based EV makers, triggered by disappointing car sales data and lower-than-expected exports for the nation.

Noteworthy: Alibaba, Nio among China stocks falling amid downbeat economic data.

Li Auto Inc. Soars but Faces Pullback

Li Auto Inc. (LI) witnessed a morning pullback of 11.1% in stock value, despite reaching a record high in the previous session. The Beijing-based EV maker reported second-quarter profit and revenue that exceeded expectations.

Nio Inc. and XPeng Inc. Face Stock Declines

Nio Inc. (NIO) experienced a 6.7% drop in stock value, while XPeng Inc. (XPEV) surrendered 5.1%.

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