Yahoo Autos Rivian Is Still Losing Almost $40,000 On Every Truck It Builds
Good morning! It’s Friday, November 8, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Rivian Losses Mount As Sales Fall
Slowly but surely, electric vehicle sales are rising here in America, with records being set just last month and automakers like BMW admitting that EVs are the only segment where they’re seeing growth. This doesn’t mean starting an EV company is getting easier, and American startup Rivian has proven just that with its eye-watering losses last quarter.
The automaker built more than 13,000 electric vehicles in the three months to the end of September 2024, but in that same period lost more than $1.1 billion as sales faltered, reports Automotive News. The losses mark a slight drop when compared with the same period last year, but still mean that Rivian is losing more than $39,000 on every single EV it sells:
Third-quarter revenue fell to $874 million from $1.3 billion in the same period last year. The 35 percent decline was Rivian’s first quarterly decrease since listing on the stock market three years ago.
The Irvine, Calif., automaker’s stock price rose about 1.3 percent in after-hours trading.
Rivian said it had cash and cash equivalents of $5.4 billion at the end of the quarter.
The company’s results took a hit from lower sales of its R1T pickup, R1S crossover and RCV delivery vans that it makes for Amazon. Sales were reduced, Rivian said, by the lack of an electric motor component that limited its ability to produce the optimal vehicle mix for the market.
“This has been a tough quarter for us because of some of the supplier-ramp challenges,” CEO RJ Scaringe said on the Nov. 7 earnings call. The automaker freshened its R1 consumer vehicles in April and updated its supplier agreements to cut costs, leading to short-term issues, he said.
The drop in revenue for Rivian stems back to a fall in sales for every model in its current range. The automaker delivered 10,018 vehicles during the three-month period, marking a 36 percent drop compared with the same period lasy year. Output was also down by 19 percent to 13,157 EVs.
As a result of the falling deliveries and production, Rivian has been forced to lower its forecasts for the full year, adds Automotive News. The Amazon-backed company is now targeting production of between 47,000 and 49,000 vehicles, which is down from the 57,000 it was initially planning to build through 2024.
Rivian will clearly be hoping that the hype around its R2 and R3 vehicles that were premiered earlier this year can continue until the day it finally starts shipping those cheaper models, as shipping near-$80,000 trucks is clearly not as sustainable as the automaker hoped.
2nd Gear: Bentley Abandons All-Electric By 2030 Goal
While Rivian is cutting production goals for electric vehicles it’s already selling, British automaker Bentley has backtracked on targets for EVs that it hasn’t even announced yet. The luxury car maker has now abandoned its aim of being an all-electric carmaker by 2030, instead admitting that plug-in hybrid models will still be available well into the next decade.
The automaker will reportedly unveil its first all-electric car in 2026, reports Reuters. The company had initially planned to make a pivot to an all-electric range in the four years following this launch, but now says it will keep selling plug-in hybrids until 2035:
The Volkswagen unit said the first electric Bentley will be a “luxury urban SUV,” which will be followed by a new plug-in hybrid or fully-electric model every year over the next decade.
During a press event, CEO Frank-Steffen Walliser said the long-range electric SUV would be more compact than a conventional Bentley, which would make it more suitable for city driving.
Earlier this year Bentley said it might keep selling hybrids beyond 2030, but made that official on Thursday when it said it now aims to be a fully-electric brand by 2035.
But Walliser said that target could shift depending on demand as some global regions are electrifying more slowly.
Bentley is far from the first automaker to back track on the switch to all-electric offerings. So far this year, automakers have slashed more than 4 million electric cars from their 2030 sales targets and Toyota has taken steps to delay its already woefully low EV ambitions.
Now, with Donald Trump preparing for a return to the White House, his disdain for EVs could further hit automakers’ pivot to electric power as tax breaks and investment in EV infrastructure dry up. Are we really about to watch automakers and lawmakers mess this one up?
3rd Gear: VW Recalls 114,000 Cars Over Faulty Airbags
After more than 6.4 million cars were recalled over deadly Takata airbag inflators, Fiat recalled thousands of cars for airbags that deployed with too much force and Hyundai recalled its Santa Fe for airbags that were basically doing everything wrong, you’d be forgiven for thinking that we’d tracked down all the faulty airbags out there. But we haven’t.
Now, Volkswagen has become the latest automaker to issue an enormous recall of cars fitted with faulty airbags, this time impacting more than 114,000 models fitted with airbags that could explode, as CNN reports:
The recall includes certain 2006-07 Passat Sedans, 2012 to 2014 Passat models and 2017 Passat Wagons, as well as certain 2017 to 2019 Beetle and Beetle Convertible models.
Airbags on the driver’s side of the vehicles pose a risk of exploding due to long-term exposure to humidity and high temperatures.
“The driver’s side frontal airbag inflator may explode due to propellant degradation occurring after long-term exposure to high absolute humidity,” said an NHTSA recall report submitted on October 30 and posted online Thursday.
Volkswagen is now beginning the process of notifying owners of impacted models. Anyone whose airbag is found to be faulty will have the driver’s side airbag replaced for free at a Volkswagen dealership across America. Customers hit by the recall should be notified by December 27.
If you are worried that your car might be affected by a recall, there are a few easy ways to check if it’s the case. First up, the National Highway Traffic Safety Administration has a super handy app that you can use to see if your vehicle is impacted by a recall, or you can head to the regulator’s website and plug your VIN into its recall search tool.
4th Gear: Stellantis Cuts Fiat 500e Production For Another Month
It wouldn’t be an edition of The Morning Shift without some more dire news for Stellantis, would it? After the automaker launched a search for a new CEO, saw profits drop dramatically and irked almost every dealer in the U.S., it’s now extended a shutdown of one of its Italian production sites.
Stellantis initially paused production at the Mirafiori plant in Turin until November 1, halting assembly of the electric Fiat 500 and two models from Maserati. Now, Reuters reports that the closure could be extended into December with production halting until the end of the year:
The planned stoppage is expected to start at the end of November and the plant might open again after Jan. 6, the report added.
“This is a rumor that has no official confirmation. The company will verify in the coming weeks the production schedules for December,” a spokesman for Stellantis told Reuters when asked for comment on the report.
Production at the historic site, which makes the electric Fiat 500 city car and two Maserati sports cars, had already been suspended until Nov. 1.
Stellantis has concentrated three months worth of production linked to its orders for the Fiat 500 into November in order to then be able to stop, the report explained. It added the group does not have all the components required to assemble the car in December.
While we’re big fans of the electric Fiat 500, that sentiment has not been shared by the masses and dramatic price cuts to try and shift the car mean it’s now one of the cheapest EVs you can pick up in America.
Sales of the cutesy EV have been struggling for months, and Stellantis was even forced to talk to lawmakers in Italy to try and rectify things. Clearly, that didn’t go as planned as the world still isn’t awash with adorable EVs instead of gargantuan pickup trucks. We can always dream, though.
