(Bloomberg) -- Electric-vehicle startups that have struggled this year got a much needed boost from Tesla Inc.'s first-quarter earnings beat.
Rivian Automotive Inc. climbed 1.6% in after-hours trading Wednesday, while Lucid Group Inc. rose 0.6%. Other EV stocks including Nikola Corp., Workhorse Group Inc. and Fisker Inc. also ticked higher. Tesla shares jumped as much as 5.2%.
The auto industry's persistent supply-chain troubles have intensified this year amid Russia's war on Ukraine, with soaring costs of raw materials, especially for batteries. While Tesla has been able to navigate the shortages better than even traditional behemoths such as General Motors Co. and Ford Motor Co., its Chief Executive Officer Elon Musk earlier this month tweeted that prices of lithium, a major ingredient of EV batteries, had reached “insane levels.”
Both Rivian and Lucid Group had also warned about supply chain pressures and rising costs.
Tesla has outperformed the EV startups trying to emulate its success this year, despite falling 7.3%. Rivian shares are down 65% since the beginning of 2022, while Lucid has fallen 45%.
Supply-chain induced corrections in semiconductor and EV stocks create “an opportunity to step in” and initiate buybacks, Mizuho Securities analyst Vijay Rakesh wrote in a note Wednesday. He added that Tesla, Rivian and Nio Inc. could benefit in the long-run as supply chains improve “remaining well-positioned with secular ~30% EV growth” through 2030.
“In addition to chip shortages, recent COVID-19 outbreaks have been weighing on our supply chain and factory operations,” Tesla said of China's coronavirus lockdowns in its earnings statement Wednesday. Chinese EV makers Nio, XPeng Inc. and Li Auto Inc. may also move as Tesla details the impacts of the Shanghai lockdowns on its production.
The company also said that rising materials costs have forced “adjustments in our product pricing, despite a continued focus on reducing our manufacturing costs where possible.”
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