EV index slides 3% as Rivian plunges 18% on share sale

The Bloomberg Electric Vehicle Price Return Index slid 3.02% to 3,475.02 points on Tuesday, dragged by Rivian Automotive Inc.'s 18% plunge — its worst session since February 2024 — after the electric-truck maker announced a planned share sale.

The share sale, reported by MarketWatch, triggered the steepest single-day decline for Rivian shares in more than two years, Bloomberg data show. The company has not disclosed the size or pricing terms of the proposed offering, though the stock's 18.12% decline erased roughly $3 billion in market value based on its prior closing price.

Other EV makers followed Rivian lower. Lucid Group Inc. dropped 9.98%, while STMicroelectronics NV's Paris-listed shares fell 7.99% and Hesai Group declined 7.56%. The index gapped lower after the US market open, extending losses that began during Asia-Pacific trading, and has now fallen in three of the past four sessions.

The selloff was concentrated in US and European pure-play EV names, while Chinese EV makers rallied. NIO Inc. rose 1.71%, Yadea Group Holdings gained 3.09% and Geely Automobile Holdings advanced 3.11%. BMW AG's European shares also rose 1.03%, suggesting the weakness was specific to EV-dedicated manufacturers rather than the broader auto sector.

Rivian's Capital Challenge

Rivian's planned equity offering comes as the company navigates a capital-intensive transition to its next-generation R2 platform, a midsize SUV expected to start production in early 2027. The Illinois-based manufacturer has relied on a combination of equity raises and strategic partnerships — including a joint venture with Volkswagen AG announced in June 2025 — to fund operations while pursuing its path to gross profitability. The company ended the first quarter with roughly $6 billion in cash and equivalents, according to its most recent filing, but has burned through more than $15 billion since going public in November 2021. The stock, which listed at $78, now trades at a fraction of that level, reflecting persistent investor concerns about cash burn and production scalability in a market where Tesla Inc. and BYD Co. dominate.

Regional Divergence Widens

The contrasting performance between US and Chinese EV stocks on Tuesday highlights a broader trend that has been building for more than a year. Chinese EV makers have benefited from aggressive pricing strategies, government subsidies and a more favorable regulatory environment, while US and European peers face margin pressure from price wars and slowing demand growth. NIO's 1.71% gain and Yadea's 3.09% advance suggest Chinese investors remain relatively optimistic about domestic EV adoption, even as global sentiment toward the sector sours. Geely's 3.11% rise was its best single-day gain in three weeks, supported by strong June delivery data from the broader Chinese auto market.

For investors, Tuesday's selloff reinforces the risks of concentrated exposure to US EV makers facing capital constraints. Rivian trades at roughly 1.5 times forward sales, a discount to Tesla's 6 times but a premium to legacy automakers, and the planned dilution from the share sale could pressure the stock further in the near term. The divergent performance of Chinese EV names, meanwhile, suggests regional allocation may matter more than sector positioning in the current environment, as the global EV market grows at an uneven pace across geographies.

This article is for informational purposes only and does not constitute investment advice.