Rivian Layoff 10% Staff and Lowers Production Forecast for 2024

[Twitter Fingers]

Elon is at on X, predicting Rivian bankruptcy in 6 quarters!

Elon says a LOT of stupid things on X.

In this case he was responding to a totally false chart of Rivian's cash and extrapolating that out.

The chart shows Rivian with 7.9 billion in cash, when in fact it is 9.4 billion (an increase from Q3 due to the convertible note raise). This is because Rivian reported a separate line item of 1.4 billion short term investments (likely a Treasury bond or something).

As "smart" as Elon is, he seems to get fooled by a lot of false information on the Internet.

Rivian's chances at bankruptcy in 6 quarters is approximately zero, as not only will their cash burn rate significantly decrease as their cost cutting measures are put into place in Q2, but they will also be raising more cash every couple of quarters to sustain operations.

And the last time he tried to "extrapolate" a trend didn't pan out so well.

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[R1TS]

Lots are full of them out here in Oregon, dealers are offering $3500 off MSRP and Kia is offering $3750 cash back. Doesn’t feel like they are selling that fast.

There can be regional differences.
But, certainly it is no different from the huge inventory of R1S available for immediate delivery in the Rivian shop. Just searching the R1S shop with my zip code (and not even counting the R1T shop inventory), I stopped counting after 170. The scrolling kept on going way past that number.

According to sales numbers for the month of January, Kia sold 1,408 just in the US.
That was an increase from ~1,100 units in December.

I’d say they’ve sold roughly about as many as Rivian R1S last month. Though I can’t be exact since Rivian doesn’t break down their numbers by model. And, everyone says this is slow sales time of the year.

* Assuming generally a third of Rivian sales are R1S, and divide by 12 months gets you in the same range as what Kia EV9 did last month.

 

[bkvargyas]

Completely agree the Normal factory will be nowhere near full production for a long time. I thought there had been talk of expanding it to 200k.

When I took a tour of the Normal factory, I was told they built the existing line on equipment that Mitsubishi left when they vacated the plant. Those robots and equipment aren't the most efficient way of doing things now days, including how the line actually operates within the plant and how parts and inventory are moved on the floor for JIT installation. I have some experience with automation, and I could just tell by looking at the various areas we walked to, there was room for improvement.

They said the real efficiency will come once the new plant is built and they can build the lines like they want to. From what little I saw, there is very little expansion room to do much anything else. They are using all of their capacity for current production. To build more R1's, they would have to cut EDV's. They could do an R2 line in place of EDV's, but I wouldn't do that.

 

[LetsgoRIVN]

Elon says a LOT of stupid things on X.

In this case he was responding to a totally false chart of Rivian's cash and extrapolating that out.

The chart shows Rivian with 7.9 billion in cash, when in fact it is 9.4 billion (an increase from Q3 due to the convertible note raise). This is because Rivian reported a separate line item of 1.4 billion short term investments (likely a Treasury bond or something).

As "smart" as Elon is, he seems to get fooled by a lot of false information on the Internet.

Rivian's chances at bankruptcy in 6 quarters is approximately zero, as not only will their cash burn rate significantly decrease as their cost cutting measures are put into place in Q2, but they will also be raising more cash every couple of quarters to sustain operations.

And the last time he tried to "extrapolate" a trend didn't pan out so well.

You are right, the 30% cost saved from Q2 and Q3 shut down should result in at least $1bn or $2bn in cash saved. Let’s hope it’s not a lie!

 

[Riviot]

Elon is at on X, predicting Rivian bankruptcy in 6 quarters!

 

[emoore]

You are right, the 30% cost saved from Q2 and Q3 shut down should result in at least $1bn or $2bn in cash saved. Let’s hope it’s not a lie!

What would they be lying about?

 

[usulio]

I guess the timing of the R2 launch is not a coincidence. Rivian is probably hoping the excitement and preorders counteract pessimism from this announcement, which they must have seen coming.

 

[LetsgoRIVN]

What would they be lying about?

30% cost saving

 

[emoore]

30% cost saving

And who is they? Rivian? Some analysts?

 

[LetsgoRIVN]

And who is they? Rivian? Some analysts?

Rivian Ofcourse

 

[SRO]

Rivian to Cut 10% of Salaried Staff, Citing Economic Uncertainty
https://www.bloomberg.com/news/arti...of-salaried-staff-citing-economic-uncertainty

Rivian Automotive Inc. revealed plans to cut 10% of its salaried workforce and set production plans well below Wall Street’s expectations as the maker of electric vehicles grapples with stagnant demand and economic turbulence.

I’m worried, how long can Rivian loose $43,000 per vehicle. It is an awesome vehicle but EV demand is really down. I think charging has a lot to do with it.

 

[LetsgoRIVN]

I’m worried, how long can Rivian loose $43,000 per vehicle. It is an awesome vehicle but EV demand is really down. I think charging has a lot to do with it.

Well they says positive margins by Q4 2024, so not too long before we see $0 loss per car

 

[usulio]

Edit: apparently wrong
Pretty sure the $XX,000 "loss per vehicle" is always a misleading number that takes total amount Rivian has ever spent (including Georgia plant, years of R&D) divided by number of vehicles sold. People need to stop treating it like a marginal loss. Every additional vehicle sold makes that number better, not worse. Correct me if I said anything inaccurate.

 

[DuoRivians]

I’m worried, how long can Rivian loose $43,000 per vehicle. It is an awesome vehicle but EV demand is really down. I think charging has a lot to do with it.

From Shareholder letter. Explains how Rivian anticipates getting to modest gross profit in Q4 2024:

 

[R1TS]

Pretty sure the $XX,000 "loss per vehicle" is always a misleading number that takes total amount Rivian has ever spent (including Georgia plant, years of R&D) divided by number of vehicles sold. People need to stop treating it like a marginal loss. Every additional vehicle sold makes that number better, not worse. Correct me if I said anything inaccurate.

No, that $43K loss per car sold is actual gross profit loss, and not operating loss ("including Georgia plant, years of R&D"). It was $30K per car in the previous quarter.

The total net loss, including everything as you are referring to, for the quarter was $1.5 Billion. A lot more than just the cost of making the vehicles.

They keep saying they will be net $0 by end of year. It's going to be tough to reach that just through cost cutting IMO, especially since the average sales price per unit will go down as more and more lower priced trims are sold. Hope they pull it out though. My portfolio could surely use a boost.

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