Rivian shares slip-up after EV maker recalls almost all vehicles

Oct 10 (Reuters) – Shares of Rivian Automotive Inc (RIVN.O) fell around 9% on Monday after the electric vehicle maker recalled nearly all of its vehicles, heightening investor concerns that the company may not not be able to meet its production target of 2023. .

On Friday, the Amazon.com Inc-backed company (AMZN.O) recalled about 13,000 vehicles due to a possible loose tether that could cause the driver to lose steering control.

Rivian began selling its electric vehicles in the third quarter of last year and has so far delivered 13,198 vehicles. Read more

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“We are most concerned about production expectations for 2023,” RBC Capital Markets said in a note Monday. Adding batteries and motors as well as plant downtime needed to increase capacity could derail Rivian’s production pace, he said.

While the widespread recall could harm the brand and cause lingering credibility issues for future production, Wedbush Securities said in a note that it doesn’t believe the recall would impact production or delivery goals. Rivian for the year.

The company’s shares fell to $30.79 in early trading – the lowest in more than a month. They have fallen 67.3% this year due to a sell-off in stocks due to an uncertain macro environment and lower production forecasts.

In March, the company halved its 2022 production forecast to 25,000 due to tough supply chain issues. Read more

Wall Street expects Rivian to make 23,590 vehicles this year, according to Visible Alpha.

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A local court in Georgia, where Rivian is building its $5 billion manufacturing plant, last week rejected a joint bid by the state Department of Economic Development and the company seeking local incentives for its project. in the state.

The local development authority had said in May that the company would get $1.5 billion in state incentives.

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Reporting by Akash Sriram and Savyata Mishra in Bengaluru; Editing by Shinjini Ganguli

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Virginia C. Taylor