Electric vehicle (EV) maker Rivian Automotive Inc. (NASDAQ: RIVN | RIVN Price Prediction) announced that its most recent quarter was solid. However, its forecast for the coming year was horrible. It raises the question whether there is any demand for its very expensive SUVs and pickups.
Revenue for the final quarter of the calendar year rose from $1.32 billion to $1.73 billion. Buried deep inside Rivian’s shareholder letter, it showed a loss of $0.70 per share, compared to the loss of $1.58 in the same period of last year.
The very bad news was that Rivian expects to deliver only 46,000 to 51,000 vehicles this year. Last year’s figure was 51,975. Even if the company makes some modest financial progress, there is no world in which falling unit sales is good. CEO R.J. Scaringe said he was worried about tariffs and the loss of tax credits on EV sales.
Rivian has battered shareholders badly. When the company went public in 2021, its stock rose enough to take its market cap to $100 billion. That is more than twice the market caps of Ford and GM today. Since then, Rivian’s market cap has dropped below $14 billion, which is still too high for a company in such deep trouble.
Rivian’s trucks and SUVs are unusually expensive, which is probably part of why its unit sales are low. Its base R1S Dual Standard SUV costs $79,500. Higher-priced models cost over $100,000. The base price for its R1T Dual Standard pickup is $69,000. The high-end version is priced at $99,900.
Rivian has boxed itself into a business model with expensive products and corporate expenses that are too high.
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