Rivian, Lucid Poised to Gain as Trump Tax Bill Ends EV Credits

On July 3, 2025, shares of Rivian Automotive Inc. en Lucid Group Inc. surged by up to 4.6% and 8.8%, respectively, following a BNP Paribas analysis suggesting that the electric vehicle (EV) manufacturers could benefit from President Donald Trump’s tax bill, which eliminates the $7,500 EV tax credit after September 30, 2025. Bloomberg reports that this legislative shift could reshape the competitive landscape for EV makers.

Reduced Competition for Rivian and Lucid

The Senate-passed bill, expected to clear the House on July 3, 2025, is set to end the federal EV tax credit, a move projected to dampen consumer demand for electric vehicles later this year. However, BNP Paribas analyst James Picariello notes that pure EV companies like Rivian en Lucide could gain an edge. “Similarly to RIVN, we do believe LCID stands to benefit from reduced EV competition as OEMs deemphasize US EV ambitions,” Picariello wrote in a client note. Traditional automakers such as General Motors, Ford, Hyundaien Kia, which have scaled up EV production, may scale back without incentives, leaving more market share for EV-focused brands.

Short-Term Boost, Long-Term Challenges

BNP Paribas anticipates a spike in third-quarter deliveries as consumers rush to purchase EVs before the tax credit expires. Rivian, with its established production of models like the R1T pickup and R1S SUV, is better positioned to capitalize on this trend compared to Lucid, which faces delays with its Gravity SUV (expected late 2025) and a crossover utility vehicle (slated for 2027). Rivian delivered 10,661 vehicles in Q2 2025, missing analyst estimates by 2.3%, while Lucid delivered 3,309 units, 4% below expectations. Despite these shortfalls, Picariello assigns Rivian an outperform rating, citing its stronger production capacity, while Lucid carries an underperform rating due to its slower ramp-up.

Industry Shifts and Consumer Sentiment

The elimination of the $7,500 credit—worth approximately £5,900 or €6,900 at current exchange rates—could raise EV prices, potentially deterring budget-conscious buyers. However, Rivian may also benefit from shifting consumer sentiment, particularly backlash against Tesla and its CEO, Elon Musk, due to his prior ties to the Trump administration. Tesla reported a 13% year-over-year delivery decline in Q2 2025, with 384,122 vehicles delivered. This contrast highlights Rivian’s potential to capture disillusioned Tesla buyers, especially for its trucks and SUVs, which start at around $70,000.

Economic and Regulatory Outlook

The bill’s passage reflects broader economic pressures, including tariff uncertainties that have weighed on EV stocks in 2025. By reducing incentives, the legislation may slow the U.S. transition to electric vehicles, which saw 1.1 million sales in 2024, according to the Department of Energy. For Rivian and Lucid, the immediate benefit lies in a less crowded market, but long-term growth will hinge on their ability to scale production and introduce affordable models, like Rivian’s upcoming R2 SUV, expected in 2026 at under $50,000.

As the EV industry navigates this regulatory shift, Rivian and Lucid stand at a crossroads, with short-term opportunities tempered by the challenge of sustaining growth without federal support.