(Reuters) – Rivian Automotive Inc. (RIVN.O) on Monday missed its first-quarter production estimates as the electric car maker grappled with supply chain constraints.
Describing supply chain bottlenecks as Rivian’s “biggest limitation” in February, CEO RJ Scaringe noted that the company didn’t have the ingredients to run a normal, Illinois, plant across all the multiple lines and shifts.
The Amazon-backed company said it has halted its commercial product line for the majority of the first quarter of 2023 to introduce new technologies including lithium iron phosphate (LFP) battery packs.
Rivian produced 9,395 cars at its regular plant in the quarter ending in March, compared to Visible Alpha’s estimate of 10,030. In the fourth quarter, it built 10,020 vehicles.
“The report likely indicates that RIVN has continued to burn cash at an alarming rate, and is nowhere near achieving a gross profit, let alone a net profit,” said Garrett Nelson, an analyst at CFRA Research, who downgraded the stock to “strong sell.” from “sale”.
Rivian shares fell 2.3% to $15.13 at midday.
However, the Irvine, California-based company has reiterated its annual production goal of 50,000.
“We expect full-year production to be likely at the end due to supply constraints … and the commercial line downtime we take in the first quarter of 2023,” CFO Claire McDonough said on an earnings call in February.
The electric car maker has been losing money on every car it makes, and narrowly missed its annual production target of 25,000 units last year.
The sequential decline in production and deliveries reflects “a step in the wrong direction for an EV maker that is an early-stage growth company,” Nelson said.
Rivian delivered 7,946 vehicles in the cited quarter, compared to an estimate of 7,090 vehicles. It delivered 8,054 vehicles in the fourth quarter.
Electric vehicle maker Tesla (TSLA.O) said Sunday that it delivered 422,875 vehicles in the quarter ending in March, up 4% from the previous quarter.
Additional reporting by Shafi Mehta in Bengaluru; Additional reporting by Akash Sriram. Edited by Rashmi Aish and Shonak Dasgupta
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