'Tesla Killers': Polestar, Rivian, and More EV Stocks to Watch in 2022

For years, analysts have been searching for “Tesla killers” or the models that will take on Tesla’s electric cars. Here are the EV stocks to watch in 2022.

Mohit Oberoi, CFA - Author

Dec. 30 2021, Published 10:34 a.m. ET

For years, analysts have been searching for “Tesla killers” or the models that will take on Tesla’s electric cars. While there hasn’t been a Tesla-killer in the real sense, the urge to find the Tesla killer has acted as free marketing for Tesla cars, which arguably offer a better value proposition compared to other models. As we head into 2022, here are the EV stocks and electric car models that you should be watching.

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To give Tesla credit, the company has scaled up operations much more profitably and faster than most people anticipated. The company’s fourth-quarter deliveries, which are expected sometime next week, should show an annual run rate above 1 million, which isn't a small achievement.

Investors should watch these EV stocks in 2022.

Overall, 2021 has been a volatile year for EV stocks and their fortunes have been divergent. On one hand, we have Tesla which is up sharply for the year. On the other end of the spectrum are companies like NIO which are down sharply. The Chinese EV maker has fallen to a 52-week low.

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In 2022, NIO will be a key EV stock that you should watch. Investors should also watch Polestar, which is set to merge with the Gores Guggenheim (GGPI) SPAC. Rivian and Lucid Motors, both of which have started commercial deliveries, will be some of the EV stocks that attract a lot of attention in 2022.

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NIO stock could outperform in 2022.

NIO has been handicapped by limited models. However, in 2022, the company will start delivering two new sedans—the ET7 and the ET5. Also, the company has started delivering cars internationally and a U.S. expansion looks firmly in the cards. The new sedans that NIO is launching look like worthy competitors to Tesla based on their features and the battery range.

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Rivian and Lucid Motors would ramp up deliveries.

Rivian and Lucid Motors are among the EV companies that went public in 2021. While Rivian is backed by Amazon, Lucid is led by a former Tesla executive Peter Rawlinson. Rivian’s pick-up truck will compete with Tesla’s upcoming Cybertruck. Lucid’s first model is the Air sedan, which is pitted against Tesla’s Model S Plaid. Both Rivian and Lucid Motors will ramp up production in 2022.

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Given their already rich valuations, both of these companies will need almost flawless execution to justify their massive market cap. However, in order to challenge Tesla, they will have to scale up production massively.

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Polestar looks relatively undervalued ahead of the merger.

Polestar will be another EV stock to watch in 2022 as the Volvo-backed company merges with GGPI. The transaction valued Polestar at an equity value of $21.3 billion and the company will get over $1 billion in cash from the merger.

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While most of the EV companies that went public through a SPAC reverse merger were pre-revenue companies, Polestar already has two models under production and expects to launch more over the next five years. The company expects to generate revenues of $1.6 billion in 2021.

Don’t rule out Ford and General Motors yet.

One of the biggest battles could be between Tesla and legacy automakers. So far, none of the automakers have come up with models that can take on Tesla. In 2022, Ford will come up with the all-electric avatar of its best-selling model F-150. It will be a battle royale between America’s best-selling pick-up model and a rather unconventional Cybertruck pick-up model from the most popular EV company on the globe.


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