Rivian reports a $2.5 billion net loss in the fourth quarter

Rivian Automotive Inc., a builder of electric vehicles, posted a quarterly loss of about $2.5 billion on Thursday, owing to rising raw material costs and supply chain issues.

In the fourth quarter, the corporation reported a net loss of $2.46 billion, compared to a loss of $354 million a year ago. It made $54 million in sales, far less than the $60 million expected by investors.

Following the announcement, Rivian’s stock dropped 13% to $35.86 in aftermarket trading.

Rivian stated in a letter to shareholders that the business believes it will have enough parts and materials to construct 25,000 vehicles this year, despite supply chain challenges. Without those parts limits, the business calculated that it could construct about 50,000 cars for Amazon on the RCV platform, including the R1T truck, the R1S SUV, and commercial vans.

Rivian reported that as of March 8, it has produced 1,410 vehicles this year and 2,425 since its inception. It claimed that in the two weeks leading up to March 8, it averaged a weekly production rate that was roughly twice that of the fourth quarter of 2021, but that supply-chain bottlenecks will persist into 2022.

“We expect to realise negative gross margins throughout 2022 as we continue to build up our manufacturing plant, manage supply chain problems, confront sustained inflationary pressures, and minimise price increases to consumers in the near term,” the business wrote in a letter to shareholders.

“The production projection for 2022 was disappointing and substantially below what they predicted in their road show, and the fourth-quarter loss was more than projected,” said Garrett Nelson, CFRA Research analyst.
Rivian, other startups, and traditional automakers like as Ford Motor Co. and General Motors are battling against EV market leader Tesla Inc., which plans to begin delivering more electric vehicles soon.

Rivian CEO RJ Scaringe stated in a Thursday conference call with analysts that the EDV-700 van for will have a “substantial” manufacturing ramp-up in the second quarter.

Rivian said it was “exploring methods to further develop” its business connection with Amazon, which holds a 20% interest in the company and has placed a 100,000-vehicle order. Rivian has announced that it would begin production of a second Amazon van, the EDV-500, this year. The EDV-500 is a smaller and slimmer version of the EDV-700.

As of March 8, Rivian has received 83,000 pre-orders for its R1T truck and R1S SUV, up from 71,000 in mid-December.

Rivian’s stock has plunged roughly 77 percent and lost $124.5 billion in market capitalization since going public in November, according to Thursday’s market closing.

The corporation had $18.4 billion in cash and equivalents at the end of the quarter.

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Kathy Lewis

Kathy Lewis is an all-around geek who loves learning new stuff every day. With a background in computer science and a passion for writing, she loves writing for almost all the sections of Editorials99.

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