Rivian has a huge appetite for money. Prior to this IPO, it raised more than $ 10 billion from investors, including Amazon and Ford, and it expects to consume billions of dollars as it attempts to ramp up production of its three vehicles. : a top-of-the-range pickup truck intended for drivers who love off-roading; a sport utility vehicle; and a delivery van that was developed with Amazon, which owns a significant stake in Rivian and has ordered 100,000 vans.
Rivian and many other automakers are betting that consumers are poised to make the switch to electric vehicles quickly over the next decade. General Motors has announced plans to phase out production of gasoline vehicles by 2035. Tesla, which is on track to sell nearly a million electric vehicles worldwide this year, has a market capitalization of 1,000 billion dollars, exceeding the combined value of GM, Ford, Toyota Motor, Volkswagen, BMW and several other automakers.
Much now depends on Rivian’s ability to ramp up production to meet customer orders. Tesla went through many difficult months when it struggled to produce its sedan in large numbers.
By the end of last month, Rivian had shipped just 156 of its pickups, known as the R1T; it plans to begin deliveries of the SUV, the R1S, next month. He said in a financial file that he did not expect to fulfill the 55,400 orders for trucks and SUVs before the end of 2023, stressing that it would take time for production lines to produce a significant number of vehicles.
Like other electric vehicle makers that have gone public this year, Rivian reports significant losses. In the first six months of this year, he suffered a net loss of $ 994 million, almost as much as for all of 2020, when he lost $ 1.02 billion. Investors may be willing to tolerate losses for a period of time. The van contract with Amazon should in theory guarantee a stable source of income.