Rivian says 2022 EV production target despite supply issues.

Amazon ordered 100,000 delivery vans, but Rivian was reluctant to say how many it shipped. On Wednesday, it only said it was “increasing...


Amazon ordered 100,000 delivery vans, but Rivian was reluctant to say how many it shipped. On Wednesday, it only said it was “increasing production and deliveries.” On the call with analysts, Scaringe said he expected pickup trucks to make up about a third of the 25,000 vehicles in the 2022 production forecast.

In many ways, Rivian epitomizes the stock market’s sharp downward turn this year.

In November, investors crowded into its initial public offering, in which the company raised $13.5 billion, and its shares then soared, briefly giving Rivian a market value almost as large as Ford’s. Motor and General Motors combined.

But the stock plunged this year after the company slashed production targets. The 80% drop in Rivian shares is much steeper than a 31% drop in Tesla shares over the same period and a 38% drop for Ford, which is launching its own electric truck.

Rivian manufactures vehicles in Normal, Illinois, and plans another plant in Georgia. Building and operating assembly lines requires huge amounts of cash, so new automakers can find themselves in financial trouble if production is behind schedule and sales are insufficient. Even Tesla, which sells more electric cars than any other company, has sometimes found itself short of funds.

In the first quarter, Rivian used $1.45 billion of cash to run its business and invest in new plant and equipment, far more than the $800 million it consumed in the first quarter of 2021. The company had $16.4 billion in cash on its balance sheet at the end of the first quarter, compared to $18.1 billion at the end of last year.

The decline in Rivian shares has reduced the value of the stakes held by its major shareholders. Amazon’s 18% stake is worth $3.2 billion, down from $16.8 billion at the start of the year. Ford, another early investor, sold some of its shares on Monday, and its remaining stake is worth $1.9 billion. He was reportedly worth $9.7 billion at the end of last year.

Rivian said it took more than 10,000 orders for its truck and SUV after raising prices in March. Those orders had an average price of more than $93,000, the company added.

But with Rivian’s vehicles selling at relatively high prices, analysts have wondered what demand might be if inflation continues to eat away at household purchasing power. “It remains to be seen what appetite consumers have for the price of a Rivian,” Nelson said.

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Newsrust - US Top News: Rivian says 2022 EV production target despite supply issues.
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