George Soros is betting on the auto industry.
The billionaire continues to invest in this sector, which is in the process of abandoning gas cars in favor of electric cars, while public policies in Europe in particular provide incentives for green vehicles.
So he picked his winners and losers. Soros initially bet on upstart Rivian, China’s NIO (NIO) – Get a free report and to a lesser extent the Lucid Group (LCID) – Get a free report. But he appears to have changed his strategy, preferring to bet on automakers that have the capabilities to mass produce. This can be inferred from the changes he just made to his US stock portfolio in the third quarter.
The Democratic mega-donor increased his stake in Tesla and continued to buy Ford debt. In contrast, Soros continued to liquidate his Rivian shares. He only owned 16.36 million Rivian (RIVN) – Get a free report shares as of September 30 acc regulatory filing.
That’s down from 8.2 percent in the second quarter that ended June 30. The stock, which was worth $538.4 million as of Sept. 30, saw its value melt to $486 million, based on the Irvine, Calif.-based automaker’s last share price.
Rivian shares are down 71.4% this year.
Supply chain issues
The company is struggling to manage the increases and supply chain disturbances. In the third quarter, the company widened its losses, recording a net loss of $1.72 billion, up from $1.23 billion in the third quarter of 2023.
“Throughout the quarter, our materials costs were impacted by inflationary pressures, which we believe will continue to impact our gross margin in the near term,” Rivian said in a letter to its shareholders.
A second shift has begun at the plant in Normal, Illinois, but Rivian has not increased its goal of producing 25,000 vehicles in 2022.
“Our primary focus remains on ramping up production,” the company said. “Demonstrated production levels in our normal factory continue to give us confidence in our systems, equipment and team members’ ability to scale our production lines.” However, we believe that supply chain constraints will continue to be the limiting factor for our production. “
Rivian currently produces the R1S SUV, the R1T pickup/truck and the EDV commercial van.
Soros also remains negative about Lucid Group, Tesla’s other young rival. The billionaire still holds put options for 400,000 Lucid shares. In other words, he believes that the stock price will fall in the short term.
Soros is still invested in China’s NIO
On the other hand, the legendary investor retains his investment in Chinese electric vehicle maker NIO, from which he holds two bonds, one with a face value of $115.32 million and the other with a face value of $25.33 million.
Stock market regulations require fund managers with more than $100 million in U.S. stocks to file a document known as a 13F within 45 days of the end of the quarter to list their holdings in U.S.-traded stocks.
The value of Soros’ U.S. stock portfolio rose 4.3 percent from the previous quarter to nearly $5.9 billion. Soros Fund Management is a family office that manages public and private capital.
“SFM invests globally across a broad range of strategies and asset classes, including public equities, fixed income, commodities, foreign exchange, alternative assets and private equity,” the firm says on its website.
Soros, whose net worth is estimated at $8.5 billion, up $1 billion from Nov. 22, according to the Bloomberg Billionaires Index, is well known for pouring money into philanthropic endeavors. Most of his firm’s assets belong to Open Society Foundations, which support “people around the world who work for fairness, justice and free expression.”