Think Tesla Is In Trouble? Pity Even More Its Wannabe EV Rivals

The combined market value of six prominent wannabes hit 400bn in 2021, but today they are worth 65bn

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In recent months, Tesla has had a bumpy ride. In January the electric-vehicle (EV) pioneer warned that growth would be "notably lower" this year, as motorists' enthusiasm for battery power loses charge. The same month it had to suspend most production at its giant factory near Berlin because of supply disruptions caused by turmoil in the Red Sea. Its market share in China, the world's biggest EV market, is falling as it fends off cheaper local competition, especially from BYD, which late last year briefly eclipsed Tesla as the world's biggest EV-maker.

Tesla hit another big pothole on April 2nd, when it reported that it had delivered fewer than 390,000 cars in the first quarter. That was down by 8.5% from a year ago-and considerably worse than already cautious Wall Street analysts were expecting.

Tesla's market value has slumped by a third this year, to less than $550bn. That is still more than any other carmaker but a far cry from the $1.2trn it was worth in 2021. Its boss, Elon Musk, is now only the world's third-richest man.

If you think the billionaire and his firm are having a rough time, spare a thought for their once-white-hot imitators. Three years ago, as Mr Musk showed that EV-making could be a trillion-dollar business, investors scrambled to back the newcomers promising to be the next Tesla. Two American startups that had gone public earlier that year were accelerating as briskly as their cars. The market capitalisation of Lucid Motors, founded in 2007, exceeded $90bn; that of Rivian, created two years later, hit around $150bn. Each was worth more than Ford, which was nearly 120 years old and sold 4m vehicles in 2021, compared with 125 for Lucid and 920 for Rivian. Chinese rivals such as Li Auto (founded in 2015), Nio and Xpeng (both in 2014) were also valued richly. In late 2021 the combined market value of six prominent Tesla wannabes hit a stonking $400bn.