Ford Motor Co (F) sells its Rivian (RIVN) shares worth US$214 mn

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Ford Motor Co (F) sells its Rivian (RIVN) shares worth US$214 mn

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 Ford Motor Co (F) sells its Rivian (RIVN) shares worth US$214 mn
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Highlights

  • US car giant Ford Motor Company (Nasdaq: F) sold shares of EV maker Rivian worth US$214 million.
  • Ford is still the fourth-largest shareholder in Rivian, with 94 million shares.
  • Rowe Price Associates Inc. is the largest shareholder in Rivian, with an 18.2% stake.

US auto giant Ford Motor Co. (Nasdaq: F) dumped shares worth US$214 million it held in electric vehicle maker Rivian Automotive Inc. (Nasdaq: RIVN). It sold the shares for US$26.80 each, according to its regulatory filing on Tuesday.

Ford is still the fourth-largest shareholder in Rivian. It currently holds close to 94 million shares or a 10.5% stake in the Irvine, California-based company, Reuters reported. Ford's selling price of US$26.8 per share on May 9 was lower than Rivian’s closing price of US$28.79 on Friday.

T. Rowe Price Associates Inc. is the largest shareholder in Rivian, with an 18.2% stake. Amazon.com Inc. (AMZN) is the second, with a 17.7% stake.

Amazon’s investment in Rivian led to a first-quarter net income loss in fiscal 2022. The US retail behemoth is expecting to receive 1,00,000 delivery vans from the EV maker by 2024.

On the other hand, Rivian is struggling to fend off the competition from Ford’s F-150 electric pickup truck. Moreover, the global supply chain problem has affected Rivian’s production. As a result, the electric-car maker had to cut its planned 2022 production by half to 25,000 vehicles.

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Ford (F) sells its Rivian (RIVN) shares worth US$214 million© Vladsseven | Megapixl.com

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The US EV market is poised to grow exponentially

In a survey titled “US Electric Vehicle Market, 2021-2028,” Fortune Business Insights reported that the US electric vehicle market would grow to US$137.43 billion in 2028 from US$28.24 billion in 2021. It will grow at a CAGR of 25.4% during the period.

Ford is among the prominent players in the electric vehicle segment in the US, along with General Motors, Tesla, Inc., and Chevrolet, among others.

Some of the world leaders in the EV market with a firm footing in the US are BMW Group, Daimler AG, Audi AG, Nissan Motor Corporation, Toyota Motor Corporation, Volkswagen, etc.

Bottom line:

A markdown in the value of its stake in Rivian led to a Q1, 2022, net loss of US$3.1 billion for Ford. Ford posted operating earnings of US$2.3 billion in Q1, 2022, last month. It was well below the year-ago quarter earnings of US$3.9 billion.

 

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