by George Soros bets on the auto industry.
The billionaire continues to invest in this sector, which is abandoning gas-powered cars in favor of electric ones, while public policies, particularly in Europe, encourage ecological vehicles.
He thus chose his winners and losers. Initially Soros bet on goodbye Rivian, the Chinese NIO (NIO) – Get a free report and, to a lesser extent, on Lucid Group (LCID) – Get a free report. But it seems to have changed its strategy, preferring to focus on car manufacturers that have the ability to mass produce. This can be gleaned from the changes it just made to its US equity portfolio in the third quarter.
The Democratic Party mega-donor increased its stake in Tesla and continued to buy Ford’s debt. Instead, Soros continued to liquidate his Rivian shares. He only had 16.36 million Rivian (RIVN) – Get a free report shares as of September 30, according to a regulatory filing.
That’s down 8.2% in the second quarter ended June 30. The shares, which were worth $538.4 million as of Sept. 30, have seen their value melt to $486 million, according to the latest listing for the Irvine, California-based automaker.
Rivian shares are down 71.4% this year.
Supply chain issues
The company is struggling to manage ramp-ups and supply chain disruptions. During the third quarter, the company expanded its losses, posting a net loss of $1.72 billion, versus $1.23 billion in the third quarter of 2023.
“Throughout the quarter, our cost of materials was impacted by inflationary pressures, which we believe will continue to impact our gross margin for the foreseeable future,” Rivian said in a letter to its shareholders.
Net order backlog shows 114,000 units in addition to 100,000 orders from its shareholder Amazon (AMZ extension) – Get a free report. The problem is knowing when Rivian will be able to deliver these vehicles.
A second shift has begun at the Normal, Illinois plant, but Rivian has not increased its goal of producing 25,000 vehicles in 2022.
“Our main focus remains on increasing production,” the company said. “Production rates demonstrated within our regular factory continue to give us confidence in our systems, equipment and team member ability to scale up our production lines. However, we believe supply chain constraints will continue to be the limiting factor of our production. “
Rivian currently produces the R1S SUV, R1T pickup/truck, and EDV commercial van.
Soros also remains negative on Lucid Group, Tesla’s other young rival. The billionaire still holds put options for 400,000 Lucid shares. In other words, he believes the stock price will go down in the short term.
Soros still invests in China’s NIO
On the other hand, the legendary investor maintains his investment in Chinese electric vehicle maker NIO, of which he holds two bonds, one with a face value of $115.32 million and the other with a face value of $25.33 millions.
Stock market regulations require fund managers with more than $100 million in U.S. stock to file a document, known as a 13F, within 45 days of the quarter’s end, listing their holdings in stocks traded on U.S. exchanges.
The value of Soros’ US stock portfolio increased 4.3% quarter-over-quarter to nearly $5.9 billion. Soros Fund Management is a family office that manages public and private shares.
“SFM invests globally in a broad range of strategies and asset classes, including public equities, fixed income, commodities, foreign exchange, alternative assets and private equity,” the firm states on its website.
Soros, whose net worth is estimated at $8.5 billion, up $1 billion, as of Nov. 22, according to the Bloomberg Billionaires Index, is well known for pouring money into philanthropic endeavors. Most of his company’s assets belong to Open Society Foundations, which supports “people around the world working for justice, equity and free speech.”
