Electric vehicles stocks slump after Silicon Valley Bank collapse adds to macro, funding concerns
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Electric vehicle stocks fell in early trading on Monday after the collapse of Silicon Valley Bank threw a spotlight on potential funding problems for tech-related startups and steered investors into a general risk-off frame of mind.
Over the weekend, the Federal Reserve moved to stem fears of a wider contagion spreading through the financial sector due to the collapse of SVB and Signature Bank. The central bank's board said it would make additional funding available to eligible depository institutions and is prepared to address liquidity pressures that may arise. However, investors have flocked to investments perceived as safer in early trading on Monday even though the electric vehicle companies did not have direct exposure to Silicon Valley Bank. There is some concerns that traditional capital and funding sources may be harder to find for EV companies. The bank collapse is adding to general anxiety over the economy as a whole, which could impact demand for EVs.
Other developments specific to the electric vehicle sector included a downgrade on Tesla (NASDAQ:TSLA) -2.04% from Wolfe Research and Rivian Automotive (RIVN) -1.65% reportedly looking to sell electric vans to more customers than Amazon.
EV stock decliners in early trading on Monday included Lightning eMotors (ZEV) -30.59%, Arrival (ARVL) -15.71%, Faraday Future Intelligent Electric (FFIE) -7.45%, Electrameccanica Vehicles (SOLO) -6.88%, Mullen Automotive (MULN) -6.45%, REE Automotive (REE) -5.55%, Tritium DCFC Limited (DCFC) -4.95%, Hellbiz (HLBZ) -4.38%, Phoenix Motor (PEV) -4.27%, Ayro (AYRO) -3.88%, and Lordstown Motors (RIDE) -3.02%.