Ives and others have offered up raves for Rivian, highlighting its corporate financial backing and the consumer-oriented features on its vehicles. MotorTrend magazine named the Rivian R1T its 2022 Truck of the Year.
Rivian confirmed Thursday it will build a $5 billion factory east of Atlanta to make electric trucks, SUVs and vans. Georgia Gov. Brian Kemp says the plant, which will employ thousands, is the largest economic-development project in state history.
But success is far from guaranteed for the Irvine, California-based company. It had delivered fewer than 400 vehicles as of mid-December, mostly to employees, from its one existing plant in Illinois.
Rivian must deliver quality vehicles at scale, build its capacity to service the vehicles it sells and fend off EV competition from rivals, said John C. Taylor, a professor of supply chain management at Wayne State University in Michigan.
“Whether Rivian will get a significant share of (the future EV market), the jury is still out,” Taylor said.
More broadly, drivers still have not embraced EVs. On average for all states, EVs are 1.5% of all vehicles, according to the U.S. Department of Energy.
The price of lithium, an essential EV battery ingredient, has reached a five-year high after nearly doubling this year, according to a media report.
Rivian itself has admitted it might stumble. “We have no experience to date selling or leasing and servicing our vehicles,” the company said in the prospectus for last month’s IPO.
On Thursday, the company reported its third-quarter loss topped $1 billion and that it was struggling to keep up with demand and meet production goals. Its stock price fell 14% in early trading Friday.
Rivian said it has 71,000 orders for pickup trucks and SUVs, in addition to a deal with Amazon, its largest investor, to acquire 100,000 delivery vans by 2030.
Consumers may also be turned off by Rivian’s high price tag with the R1T starting at $74,075.
Early indications, though, are that the Rivian R1T could be a home run. MotorTrend raved about the truck’s handling and acceleration, saying it’s the “most remarkable truck” its editors have ever driven. Ives said consumers will flock to features like a camp kitchen with two burners and a three-person tent installed in the rear of the vehicle.
Rivian has shown a knack for raising money. Before its November IPO, which valued the company at $100 billion and raised about $14 billion, Rivian got investments from Amazon, Ford and mutual fund manager T. Rowe Price. Rivian raised a total of $10 billion before its IPO, Ives said.
Cox Enterprises, owner of The Atlanta Journal-Constitution, owns a 4.7% stake in Rivian and supplies services to Rivian. Sandy Schwartz, a Cox executive who oversees the AJC, is on Rivian’s board of directors and holds stock personally. He does not take part in the AJC’s coverage of Rivian.
The free market for electric trucks will likely be a battlefield.
Tesla’s Cybertruck is scheduled to start production next year. Legacy automakers like General Motors and Volkswagen are ramping up in EVs. Toyota, which has been criticized for neglecting EVs, said on Dec. 14 it will invest $35 billion in EVs through 2030.
Ives predicts that Rivian’s toughest competitor will be the electric version of Ford’s F-150 pickup truck, one of the most popular trucks in the U.S. Production of the electric F-150 is scheduled to begin in spring 2022.
--Staff writer J. Scott Trubey contributed to this report.