What’s Going On Here?Rivian gave a worse-than-expected update late last week, but the carmaker’s lacking all the right stuff it needs to put itself back together again. What Does This Mean?Rivian’s first quarter as a public company was destined to be tough: it admitted in December that it wasn’t going to make enough electric vehicles (EVs) to reach its 2021 production targets. So with only 909 EVs delivered last quarter, Rivian brought in just $54 million in sales – 10% lower than analysts were expecting.
Rivian’s 83,000 customer pre-orders might sound like the road to recovery, but it just can’t make enough cars to keep up: it’s only made about 1,400 so far this year. And don’t expect many more anytime soon: it said it’ll struggle to get key parts for its EVs while supply issues continue, so it’s halved this year’s production expectations to 25,000. Why Should I Care?For markets: Buyers are moving on.
Rivian boasted a $153 billion market value at its peak last year, but that’s since dropped to under $40 billion (tweet this). After all, it’s had its fair share of problems on top of those production issues. For one, Rivian’s proposed price hike brought about intense backlash from some customers earlier this month, with plenty of them canceling their orders. And for another, Amazon – which agreed to buy 100,000 vans from Rivian – said in January that it’ll also start buying electric vans from rival carmaker Stellantis in the future, passing up any more orders with Rivian.
The bigger picture: Follow the market leader.
Rivian’s taking a leaf out of Tesla’s book: it announced plans to start using new LFP batteries in its EVs, just like the market leader did back in October. Looks like the right time to switch: the batteries sacrifice some driving range, sure, but they don’t use nickel or cobalt – two key battery metals that have soared in price since war broke out in Europe. | 
