Rivian Notifies Reservation Holders That the R1S Electric SUV Will Be Delayed Until Mid-2022
Amazon-backed electric vehicle maker Rivian started notifying customers who have reserved the R1S SUV of extended delivery delays, several media outlets reported on Wednesday.
Rivian shares fell 4.5% to $114.31 in afternoon trade as investors fear that Rivian won't be able to fulfill all of the orders for the R1T and R1S SUV as promised.
The company had earlier said R1S would begin production at the Normal, Illinois plant in December, with the first deliveries expected in January. Depending on where customers are in the reservation queue, some may not get their R1S SUVs until later next year or possibly in early 2023.
Rivian has now started sending emails to customers to inform them that the delivery window has been changed to between May and July at the earliest.
One Rivian reservation holder posted in a Rivian discussion group on Facebook that he pre ordered his Rivian SUV in November of 2019, but was just notified that estimated delivery will be May-June 2022. The email also said that Rivan was now in the process of ramping up production at its factory.
Rivian was not immediately available for a comment.
Rivian launched its high profile IPO earlier this month. Investors helped boost its market cap to over $100 billion over the past ten days. Rivian is now the second biggest U.S. automaker after Tesla and is now worth more than U.S. automaker Ford Motor Co and General Motors, but delayed deliveries could further impact the company's share price.
Rivian's shares are listed on the NASDAQ under the symbol "RIVN". Its share price was $116.63 on Wednesday afternoon. The stock surged as high as 53%, reaching $172.01 on Nov 16.
In an amended SEC filing on Nov 5 ahead of Rivian's IPO earlier this month, the company wrote that it had approximately 55,400 R1T pickups and R1S SUV pre-orders in the U.S. and Canada as of October 31, 2021.
Each customer paid a fully refundable deposit of $1,000 to reserve their Rivian vehicle, but it also can be cancelled at any time and the deposit returned to the customer.
But in its amended SEC filing, Rivian wrote, "Based on our current production forecast, we expect to fill our pre-order backlog of approximately 55,400 R1 (R1T, R1S) vehicles by the end of 2023."
However with an influx of cash from its IPO, Rivian announced plans recently to build a second U.S. factory, which might help it meet demand. The company also has plans to eventually expand to Europe and China.
Rivian however, has not provided a location or time frame for construction of a second U.S. plant, meaning that the company will have to ramp up production at its current factory in Normal, Illinois to get its electric vehicles to reservation holders.
Rivian said its factory in Illinois is currently equipped to produce a total of 150,000 vehicles annually, distributed between the R1 platform, which will be used to produce the R1T pickup and and R1S SUV, and the RCV platform, which will be used to produce electric delivery vehicles (EDVs) for Amazon and other commercial vehicles. However, in order to achieve maximum output, Rivian said it would need to run the factory "at its full rate with multiple shifts."
The current annual capacity for the two EV platforms is roughly 65,000 and 85,000 vehicles, according to Rivian. The company said it produced just 104 R1T pickups during the last week of October. The number represents just 8% of its target R1 production rate of 1,310 EVs per day.
Rivian expects to achieve an annual vehicle production rate of up to 150,000 vehicles by late 2023. Which means that new reservation holders hoping to take delivery of an R1T pickup or R1S SUV pickup by spring 2022 might have to wait up to 18 months longer.
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