For Rivian And Lucid, The 'Valley Of Death' Just Got Even Steeper

Tariffs, the death of EV tax credits, no more regulatory credits, supply chain crunches... what's an EV startup to do?

Patrick George

By: Patrick George

Aug 8, 2025 at 10:32am ET

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If launching a new auto company was an easy effort, we'd have a hell of a lot more car brands on the road than we do. It's very telling about the nature of the industry that Tesla was the first "successful" new American automaker since... well, Chrysler, probably.

But things are even harder out there for new players lately, as my co-host Tim Levin and I explain on this week's Plugged-In Podcast. This week, Rivian and Lucid both revealed similar challenges on their earnings calls: losses and potentially increased prices from tariffs, the loss of electric-vehicle tax credits in September, no more regulatory credit revenue, and various supply chain crunches.

This phase for both automakers is called the "valley of death." It's the point between being a newcomer startup that largely runs on investor capital and still burns cash, and when it becomes sustainably profitable.

This is not to say that Rivian and Lucid aren't extremely promising; between more revenue, new upcoming factories, expanded lineups and promising models coming soon, I'd say both are in better shape than they were in 2024. But the latest policy changes have handed them a situation that's much tougher as well.

But! It's not all doom and gloom on the podcast today! Tim and I also preview Ford's big announcement on Monday, believed to be its so-called "skunkworks" EV platform and new affordable electric model. They're calling it a "Model T moment," and I can't think of a bigger way to hype this up. We'll see if Ford can deliver soon.

Finally: is Elon Musk's staggering new $30 billion pay package really worth it? And what does that mean for where Tesla is headed next?

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Contact the author: patrick.george@insideevs.com