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

Oct 10 (Reuters) – Shares of Rivian Automotive Inc (RIVN.O) closed down 7.3% on Monday after the electric vehicle maker recalled nearly all of its vehicles, heightening investor concerns about that the company may not be able to meet its 2023 production target.

Rivian’s market capitalization fell more than $2 billion to $31.1 billion in a single day, compared to automakers such as Ford Motor Co (FN) and General Motors Co (GM.N), which are valued at $45.67 billion and $47.08 billion, respectively.

On Friday, Amazon-backed Rivian recalled about 13,000 vehicles due to a possible loose tether that could cause the driver to lose steering control.

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The company started selling electric vehicles in the third quarter of last year and has so far delivered 13,198 vehicles. Read more

“We are more concerned about production expectations for 2023,” RBC Capital Markets said Monday. Adding batteries and motors, as well as plant downtime needed to increase capacity, could derail Rivian’s production pace, according to the brokerage.

Although the widespread recall may harm the brand and cause lingering credibility issues for future production, Wedbush Securities said it does not believe the recall would impact Rivian’s production or delivery goals for the company. ‘year.

Rivian shares have fallen 67.3% this year, following a decline in production outlook and a sell-off in stocks due to an uncertain macro environment.

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; Additional reporting by Yuvraj Malik; Editing by Shinjini Ganguli and Shounak Dasgupta

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