Lucid vs Rivian Stock: Which Is Best?

Few realize that Lucid Group (NASDAQ: LCID) traces part of its engineering DNA back to Atieva, a company that initially specialized in developing advanced battery systems for Formula E racing teams. Before the high-profile splash of the Lucid Air sedan, Lucid’s engineers were quietly perfecting electric drivetrains in the crucible of motorsports.

This racing pedigree helped the company engineer a powertrain that offers truly impressive range—up to 516 miles on a single charge for the Lucid Air Grand Touring edition, according to EPA estimates. That’s a number that still puts most competitors, including Rivian Automotive (NASDAQ: RIVN), on the defensive.

But range alone doesn’t determine who comes out ahead in the increasingly crowded electric vehicle landscape. With Rivian carving out a niche in the rugged adventure EV segment and Lucid going after the luxury sedan market, the question becomes which company’s stock looks like the stronger long-term prospect?

Rivian Is Producing Way More Than Lucid

Lucid eclipsed EV rivals with its high-performance battery and Asia-US supply chain, which together formed a pretty wide moat.

Meanwhile, Rivian’s operations benefited early from a $700 million funding round led by Amazon as well as its order for 100,000 custom delivery vans that accelerated revenues.

It hasn’t all been rosy, though, with management reporting an annual production rate closer to 49,000 vehicles, down from 57,000 last year, while Lucid’s recent investor updates indicated deliveries in the range of approximately 1,804 in its last quarterly update.

Lucid Is Luxury Whereas Rivian Is Mass Appeal

Lucid is unabashedly focused on the luxury end of the EV market and has been clear in its attempt to directly challenge Tesla’s Model S.

Ex-Tesla engineer and CEO Peter Rawlinson says what sets Lucid apart is its proprietary drive unit efficiency that will translate into better margins as the company scales. Lucid’s emphasis is on premium technology and long range is coupled with targeting customers who want top-tier performance wrapped into a status symbol.

By way of contrast, Rivian sells its R1T pickup and R1S SUVs to capture the off-road buyers who would ordinarily favor internal combustion engines.

Rivian’s tapping into a market segment that Tesla hasn’t fully embraced and Lucid doesn’t seem to be pursuing, meaning those loking for an EV to conquer the backwoods on a weekend while still serving as a family hauler.

The luxury aspect of Lucid is clear in its sale prices that frequently eclipses $100,000. The direct-to-consumer model has a concierge-like service that includes test drive sessions at boutique showrooms, as well as over-the-air software updates.

Rivian, whose R1T starts around $73,000, before tax credits, targets a broader upscale demographic and has a backlog of thousands of customers. Lucid’s order book is not disclosed but has been speculated by analysts to be leveling off. Data from registration filings in California suggest Rivian’s presence is surging in states with a penchant for early EV adoption, while Lucid’s footprint remains most visible in affluent coastal cities.

Both EV Makers Are Burning Cash

Over the last 60 months or so, Lucid’s investors have had little to celebrate, with the stock falling by around 74.4%. Much of this decline can be attributed to the company’s anchoring debt load. Today, Lucid carries long-term liabilities totaling roughly $2 billion, while its cash balance has dwindled dramatically—slipping from about $6.2 billion at the close of 2021 down to just $1.8 billion in its most recent quarterly report.

Some analysts remain cautiously upbeat and have assigned the stock a price target of $2.82 per share and raised their earnings estimates for the upcoming quarter. Still, management keeps reporting poor gross margins that sit now at an awful -106% and there are no signs or expectations among the Wall Street crowd of impending profitability this year.

Like Lucid, Rivian is burning through cash pretty quickly also and it too has unenviable gross margins of -44.9%. To put this in simple terms, the cost of goods sold was $1.266 billion last quarter while the revenues generated were $874 million, and none of those costs include R&D or selling expenses.

In spite of the balance sheet concerns, 10 analysts upgraded their estimates for earnings in the upcoming quarter too and collectively the price target on the stock sits at $15.11 per share.

Both Rivian and Lucid are Struggling to Scale

Where Tesla’s greatest achievement has been to scale manufacturing, Rivian and Lucid are still sledding uphill in this regard. 

Rivian has undergone extensive retrofits to support electric drivetrain assembly. And while its location provides relatively efficient logistics for domestic supply chains allowing management to steadily ramp output the negative COGS figure in the P&L is a clear fly in the ointment.

To get that under control, more sales are needed and to achieve that Rivian expects to bring its second plant online in Georgia to dramatically boost production capacity and eventually lower per-unit costs.

Much of Lucid’s production line is dedicated to the Lucid Air and future Gravity SUV so it’s not very well-equipped yet to scale manufacturing. That’s evident in the low current utilization rates that are in turn keeping unit costs elevated.

The top brass have emphasized a slow and steady approach is deliberate and, unlike mass-market EV makers, their niche is about quality over volume. Nonetheless for Lucid is to compete with the likes of Rivian, it is imperative that it improves manufacturing efficiencies and increases volumes to dilute fixed costs.

On a positive note, Rivian’s labor hours per vehicle have been trending downward which suggests that the learning curve is kicking in. And supplier sources note that Rivian’s procurement contracts are structured to improve margins as parts volumes increase.

Lucid’s supplier agreements are reportedly more bespoke leading to lower volumes of production and higher costs.

Where Rivian’s flexible assembly lines can shift between R1T, R1S, and the Amazon delivery van relatively seamlessly, Lucid has a narrower product lineup and relies heavily on the success of the Air.

Rivian vs Lucid Stock: Which Is The Better Bet?

While both Rivian and Lucid are burning cash quickly, Rivian has better gross margins, higher volumes and been able to scale better.

Rivian has wowed buyers with its EVs, such as a gear tunnel, built-in kitchen option for camping, and over-the-air updates that improve off-road capabilities. Its vehicles are built to handle river crossings, rocky terrain, and snowy trails. The firm’s dynamic suspension system, which automatically adjusts ride height and damping, is a selling point for adventure-oriented customers. Rivian’s electric platform could also expand into other segments, including smaller SUVs and international markets, further differentiating it from a strictly luxury-sedan competitor like Lucid.

Lucid’s technology advantage lies in its “miniaturized” drive units and advanced battery packs. The company’s top-trim Air Dream Edition can go head-to-head with Tesla’s Plaid variants and, according to early benchmarks, achieve impressive efficiency metrics. Lucid’s software architecture, intuitive infotainment, and sleek design aesthetic set it apart as a premium brand.

Data from independent testing agencies shows that Rivian’s R1T can travel approximately 328 miles on a single charge, while its dual-motor variants are targeting even better efficiency. Customer surveys indicate high satisfaction with Rivian’s built-in navigation that identifies off-road trails and charging stations along popular adventure routes. On Lucid’s side, engineering reports highlight the Air’s state-of-the-art battery pack, which manages heat and cold climates more efficiently than many competitors, potentially reducing battery degradation over time. Both companies have robust patent portfolios: Lucid claims unique inverter designs and motor cooling techniques, while Rivian owns patents related to modularity of its skateboard chassis—intellectual property that could shape EV innovation for years to come.

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.