Rivian, which has been rocking the stock market since the blockbuster initial public offering, further overshadowed its outlook on Thursday, reporting that supply chain problems could seriously hamper production of its electric vehicles.
The company said it would only be able to produce 25,000 vehicles this year, half the number it could have built without a supply chain “basic limiting factor”.
Problems securing parts and materials are affecting all automakers, but it hits the revision when it sells too few vehicles and faces competition from large companies.
“Like the rest of the industry, we expect supply chain challenges to remain the same until 2022,” Rivia said in a letter to shareholders detailing its financial results last year. In a call with Wall Street analysts on Thursday, Rivin’s chief executive, RJ Scarring, said the problems were focused on “a small number of parts.”
Revian makes high-end trucks – designed more as off-road vehicles than cargo haulers – and sport utility vehicles. Rivian also has a contract to build an electric delivery van for the major shareholder, Amazon, which has placed an order for 100,000. When the Revion went public, investors saw it as a potential competitor to Tesla, the largest electric vehicle maker.
A critical year for electric vehicles
Although the overall auto market is stable, the popularity of battery-powered cars is growing worldwide.
Riviana said that as of Tuesday, it had produced 1,410 vehicles this year, a fraction of the 83,000 orders submitted. The company did not say how many vans it has delivered to Amazon this year.
Stock analysts said Rivian’s report was disappointing and its shares fell 12 percent in after-hours trading after the company announced its results.
“It’s been a very disappointing name,” said Dan Ives, analyst and managing director at Wedbash Securities, and the results show that Rivian still has a lot of wood to cut. He said he originally expected Rivian to build 40,000 vehicles this year, more than the company’s latest forecast, adding that analysts expected orders for Rivian vehicles to exceed 83,000.
Along with other EV manufacturers, Revion will face rising prices of lithium and nickel, which are used to make batteries. Russia is a major exporter of nickel and its price has risen on fears of a disruption in the supply of the metal.
Mr. Scarring said.
Rivian went public in November, raising $ 13.5 billion – he will need cash to expand his factory in Normal, Ill., And build one in Georgia. Rivian had a share price increase before General Motors had a market value, but now it is trading at about half its IPO price.
Rivian said the stock has declined in recent months after it faced production challenges, followed by a further decline in consumer relations slump over pricing. Rivian said last week that it would increase the prices of its vehicles, which it has already ordered. Faced with the backlash, Rivian stepped back and only applied the increase to the new order, and Mr. Scarring has apologized in a letter to customers.
Before the price change, Revian’s truck and car could cost as much as 83,000. After the introduction of the new offer, the price could reach $ 95,000.
Rivian had revenue of $ 55 million last year and a net loss of $ 4.7 billion. It used 4.4 billion in cash to run its business and invest in new facilities and equipment, and had $ 18 billion in cash on its balance sheet at the end of last year. The company said it expects a loss of $ 4.75 billion this year under the measure of profit, known as adjusted earnings before interest, taxes, depreciation and amortization.
Mr. Ives said investors can also consider higher levels of spending, especially if they expect a higher order number. “The cost is a lot higher than expected at Overseas Street,” he said. “If pre-orders were in motion, the street would be fine with it.”
The executive overseeing Rivian’s operations left last year because the company was trying to increase production. On Thursday, Mr. Scarring said the company will announce a new chief operating officer next week.