Rivian shares tumbled about 9% on Monday after the automaker recalled nearly all of its electric vehicles, adding to fears that the company may not be able to meet its 2023 production target.
The Amazon-backed company recalled about 13,000 vehicles on Friday due to a possible loose fastener that could cause drivers to lose control.
Rivian started selling its electric vehicles in the third quarter of 2021 and has so far delivered 13,198 units.
“We have greater concerns about production expectations for 2023,” RBC Capital Markets said in a note. The addition of batteries and motors and the downtime required to increase capacity could disrupt Rivian’s production pace, RBC added.
While the widespread recall could damage the brand and cause lingering credibility issues for future production, Wedbush Securities said it did not believe the recall would affect Rivian’s production or delivery targets for the year.
The company’s shares hit a low in more than a month, falling 67% this year.
In March, the company cut its 2022 production forecast in half to 25,000 vehicles due to supply chain issues.
Wall Street analysts expect Rivian to build 23,590 vehicles this year, according to Visible Alpha.
A court in Georgia, where Rivian is setting up a $5 billion plant, last week rejected a joint proposal by the state government and the company that would have involved a $1.5 billion incentive for the project.
(By Akash Sriram and Savyata Mishra)
Source: CNN Brasil
Joe Jameson, a technology journalist with over 2 years of experience, writes for top online news websites. Specializing in the field of technology, Joe provides insights into the latest advancements in the industry. Currently, he contributes to covering the world stock market.
