Here’s why Rivian (RIVN) is cutting its EV production goal for 2024

baua

Here’s why Rivian (RIVN) is cutting its EV production goal for 2024


After Rivian (RIVN) lowered its production goal for the year, the EV maker said it was because of a supply shortage. A new report sheds some light on the situation.

Following third-quarter delivery and production numbers on Friday, Rivian cut its production plans for the year.

Rivian now expects to build between 47,000 and 49,000 vehicles this year, 14% to 17% lower than its previous 57,000 target. It’s also significantly lower than the 57,322 vehicles produced last year.

In a press release, the company said it is “experiencing a production disruption due to a shortage of a shared component on the R1 and RCV platforms.”

Rivian says the disruption began in Q3 and has “become more acute in recent weeks.” A new Bloomberg report gives us more details on what’s really going on.

According to sources familiar with the matter, the disruption was caused by a miscommunication between Rivian and its supplier, Essex Furukawa, earlier this year.

Rivian-EV-production-goal
Production at Rivian’s Normal, IL plant (Source: Rivian)

Why Rivian is cutting its EV production goal for 2024

Essex Furukawa makes magnet wire for most major OEMs, but the miscommunication has left Rivian without enough copper windings to hit its goal.

The shortage is impacting the output of Rivian’s R1T, R1S, and electric delivery vans (EDVs) built for Amazon.

Rivian-EV-production-goal
Rivian commercial electric van, R1S, and R1T (Source: Rivian)

The sources said Rivian “miscalculated” its supply needs with the supplier. Rivian has found other sources, but they would be too costly at such short notice.

Despite this, Rivian did reaffirm plans to deliver between 50,500 and 52,000 EVs this year. With another 10,018 delivered in Q3, Rivian has now handed over 37,369 vehicles through the first nine months of 2024.

Q1 2024 Q2 2024 Q3 2024 2024 YTD 2024 guidance
Deliveries 13,588 13,790 10,018 37,396 50,500 – 52,000
Production 13,980 9,612 13,157 36,749 47,000 – 49,000
Rivian deliveries and production by quarter in 2024

Rivian also reaffirmed its goal of achieving its first gross profit in Q4 during its Investor Day in July. In Q2, the company’s losses widened to $1.46 billion, with a $32,705 loss on every vehicle built.

We will learn more about Rivian’s situation when it releases third-quarter financial results on November 7, 2024.

Rivian-EV-production-goal
Rivian (RIVN) stock chart Q3 2023 through Q3 2024 (Source: TradingView)

Rivian’s stock is down over 50% in 2024 and over 90% from its all-time high set in November 2021, shortly after going public

Meanwhile, the company is taking steps to restart construction in Georgia, where it plans to expand production of its lower-cost R2.

FTC: We use income earning auto affiliate links. More.

Honda City facelift to break cover soon. India debut in…

By: HT Auto Desk | Updated on: 03 Nov 2024, 08:48 AM Honda City sedan…

Next-gen 240 ton CAT electric haul truck gets to work in Colorado mine

With a massive, 240 ton payload and a host of new features, the first of…

Chinese JAC delivers 100 MD electric trucks to North America [video]

Chinese electric truck maker JAC has shipped 100 MD electric trucks (cab and chassis) from…