Rivian shares fall after electric-vehicle maker cuts production forecast

Highlights

• Rivian Automotive shares fell about 8% in premarket trading Friday after the electric-vehicle startup cut its annual production forecast for 2024.
• Rivian said the reduction in its production target -- to 47,000 to 49,000 from 57,000 units -- was due to "production disruptions."
• Rivian produced 13,157 vehicles at its Normal, Illinois, manufacturing facility in the third quarter and delivered 10,018 vehicles.

Shares of Rivian Automotive
fell about 4% in early trading Friday after the electric vehicle startup delivered fewer vehicles in the third quarter than analysts expected and cut its full-year 2024 production forecast.

The company said the lower production target -- to 47,000-49,000 from 57,000 units -- was due to "production disruptions due to a general component shortage" in its R1 vehicles and commercial trucks.

"These supply constraint impacts began in the third quarter of this year, have worsened in recent weeks, and are ongoing." "Due to the supply constraints, Rivian is revising its full-year production guidance to 47,000 to 49,000 vehicles," the company said in a statement.

A Rivian spokesperson said the component causing the problem is part of the internal engines, but declined to provide further details.

Rivian CEO RJ Scaringe mentioned issues with a number of vendors during a Morgan Stanley investor conference last month: "We've had some vendor issues recently that have been challenging and in particular some issues related to our internal engines with some painful components and a reminder of how complex a multi-layered supply chain can be."

Despite the shortfall, the company reiterated its full-year delivery guidance with low single-digit growth starting in 2023, expected to be between 50,500 and 52,000 vehicles.

Rivian disclosed parts shortages as part of its third-quarter vehicle production and delivery report.

The company produced 13,157 vehicles at its Normal, Illinois manufacturing facility in the period ending September. 30 and delivered 10,018 vehicles during that time. Analyst estimates compiled by FactSet expected deliveries of 13,000 vehicles in the third quarter.

Rivian shares have fallen more than 50% in 2024 as demand for electric vehicles was weaker than expected and the company burned through a significant amount of cash.