Q3 2024 Production / Delivery Numbers… Not good

[NY_Rob]

Is Connect+ really a revenue stream? Seems like it may be more of just offsetting cost.

Tesla charges $99/year for LTE connectivity, I'm sure they're not losing money on it, but they certainly can't be making much either. Rivian charges $159/year, so they're making a little more, but certainly not a big profit center for them. And, we don't know what the take rate on Connect+ is yet, it could be pretty low till they finally fix the continuing Apple audio issues and add real meaningful streaming video services.

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[DuoRivian]

One “advantage” of reduced production in W4 should be staff at the factory taking more time to do QC and prevent issues. Will be interesting to see if this happens and lightens the load on the service centers.

 

[Electron]

Tesla charges $99/year for LTE connectivity, I'm sure they're not losing money on it, but they certainly can't be making much either. Rivian charges $159/year, so they're making a little more, but certainly not a big profit center for them. And, we don't know what the take rate on Connect+ is yet, it could be pretty low till they finally fix the continuing Apple audio issues and add real meaningful streaming video services.

Indeed. Even with being overly generous and assuming that 52,000 owners (in the near future) were all paying $149.99 a year, that's only $7.8M which is peanuts in the grand scheme of things.

To add, both Tesla and Rivian use AT&T which is horrible and wish that they'd switch to a more reliable and faster provider like T-Mobile.

In my Teslas when driving through semi remote and non remote areas, sometimes I get the black unloaded squares on the screen, which is annoying, due to AT&It's crap unreliable service.

If I'm using Spotify from the built in app, the stream either is interrupted due to poor signal and/or plays at low kbps.

The funny thing is if I BT Spotify from my phone that's on T-Mobile it plays at the Highest bitrate and uninterrupted through the same areas.

 

[Move]

September deliveries were half of all Q3, to me that shows potential upside to Rivian figuring this out. I’m of the belief that what has likely led to the poor performance was more struggles with the retooling done earlier this year. Supply chain issues should have been considered during the retooling. I want to see this company invest in some solid operational leadership. They have great vision, design, and innovation, but to date they haven’t been able to show operational stability. This should be their focus before R2. Plenty of time to right the ship in my opinion

 

[André]

September deliveries were half of all Q3, to me that shows potential upside to Rivian figuring this out. I’m of the belief that what has likely led to the poor performance was more struggles with the retooling done earlier this year. Supply chain issues should have been considered during the retooling. I want to see this company invest in some solid operational leadership. They have great vision, design, and innovation, but to date they haven’t been able to show operational stability. This should be their focus before R2. Plenty of time to right the ship in my opinion

What led to half of Q3 deliveries in September is the expiry of outstanding vouchers at the end of September. To me deliveries of July/August are a better run rate of deliveries for the next few months, and were actually also helped by the vouchers. Keep in mind that the plant was restarted in May and as early as June some unsold Gen 2 were added to the Shop inventory. Demand must be the issue.

 

[JonW716]

I was contemplating upgrading to the Trimax, but after seeing the losses and super low demand I decided against it this morning. I am second guessing buying the 24 R1S dual max for fear of what will happen to Rivian in another 6 months the way they are burning cash. I am hoping they survive but expecting another huge cash infusion from some 3rd party will be necessary in the next year. At this point I am uncertain about the brand surviving, and if not…… then where will all the owners be? Are we going to have unserviceable vehicles? How are we going to get replacement parts? How badly will our vehicles tank in price? All these things are running throughout my mind now, and I hate to say it but 2nd guessing not getting the model X plaid…… Thinking of taking a loss and getting out of it depending on the next quarters performance, although I am still rooting for the brand. My optimism has turned to pessimistic at best.

 

[Mark_AZR1T]

Rivian has an innate ability to slip on every banana peel laying around. It doesn't really matter if there was a supply-chain challenge, factory reset, market headwinds, EV slow down. They are fighting for their lives.

Fighting for your life is part-and-parcel of a start-up, I get that. The window to get this right is becoming more narrow. Profitibility in Q4 has been the 'mantra' for quite a while. They already know it is or isn't possible, but they have to play the market game.

I'm not sure the R2 is the 'solution'. I think the culture needs to pivot (now) and I'm not sure they can accept that in Normal. We love our Rivian's and to drive them, it is pure joy to both my wife and I. That doesn't blind me to challenges though.

Anyone conjure up a guess of how many trucks they are actually selling?

 

[Zoidz]

...
Rivian needs to offer heavy incentives, but now that they've played the "excuse card" (cheap move honestly), who knows what else they'll do now. - (Conveniently lowering the numbers at their will to offset the poor demand.)
...

"As a result of the supply shortage, Rivian is revising its annual production guidance to be between 47,000 and 49,000 vehicles."

I assume your comment "played the excuse card" is regarding the above quote? I would typically agree with you, but given that they just retooled the line and had the Gen1 -> Gen2 changeover, it's plausible that a supplier failed to ramp up, OR Rivian failed to properly secure/confirm OEM quantities - which would obviously be their own fault and "supply shortage" is true but self-inflicted. Example: Rivian has new wheels for Gen 2. There were supplier constraints on certain wheels during Gen 1 ramp up.

Dunno, just saying it's plausible and not necessarily a fabricated excuse.

 

[majorfriend]

I was contemplating upgrading to the Trimax, but after seeing the losses and super low demand I decided against it this morning. I am second guessing buying the 24 R1S dual max for fear of what will happen to Rivian in another 6 months the way they are burning cash. I am hoping they survive but expecting another huge cash infusion from some 3rd party will be necessary in the next year. At this point I am uncertain about the brand surviving, and if not…… then where will all the owners be? Are we going to have unserviceable vehicles? How are we going to get replacement parts? How badly will our vehicles tank in price? All these things are running throughout my mind now, and I hate to say it but 2nd guessing not getting the model X plaid…… Thinking of taking a loss and getting out of it depending on the next quarters performance, although I am still rooting for the brand. My optimism has turned to pessimistic at best.

Woah...

I get it's not great news, but this is an over reaction.

They have the cash needed to make it to R2 launch in 2026.

And if they can't make a go of it with R2 they have additional options to raise more cash.

And if things still aren't going well they've built enough of a customer base they will attract buyers.

The brand isn't going anywhere anytime soon, certainly not in 6 months.

 

[Electron]

September deliveries were half of all Q3, to me that shows potential upside to Rivian figuring this out. I’m of the belief that what has likely led to the poor performance was more struggles with the retooling done earlier this year. Supply chain issues should have been considered during the retooling. I want to see this company invest in some solid operational leadership. They have great vision, design, and innovation, but to date they haven’t been able to show operational stability. This should be their focus before R2. Plenty of time to right the ship in my opinion

What led to half of Q3 deliveries in September is the expiry of outstanding vouchers at the end of September. To me deliveries of July/August are a better run rate of deliveries for the next few months, and were actually also helped by the vouchers. Keep in mind that the plant was restarted in May and as early as June some unsold Gen 2 were added to the Shop inventory. Demand must be the issue.

Definitely, what @André said. It is overly obvious that Q3 was the quarter of vouchers since it had a hard cut off of Sept 30th.

I was contemplating upgrading to the Trimax, but after seeing the losses and super low demand I decided against it this morning. I am second guessing buying the 24 R1S dual max for fear of what will happen to Rivian in another 6 months the way they are burning cash. I am hoping they survive but expecting another huge cash infusion from some 3rd party will be necessary in the next year. At this point I am uncertain about the brand surviving, and if not…… then where will all the owners be? Are we going to have unserviceable vehicles? How are we going to get replacement parts? How badly will our vehicles tank in price? All these things are running throughout my mind now, and I hate to say it but 2nd guessing not getting the model X plaid…… Thinking of taking a loss and getting out of it depending on the next quarters performance, although I am still rooting for the brand. My optimism has turned to pessimistic at best.

The depreciation is going to be nuts as we typically see with most luxuryish / luxury cars.

Therefore, that Tri-Motor sitting at ~$108K and using Rivian's own average numbers of a 62% residual factor, in a few years the Tri-Max will be a whopping ~$67K.

Ouch.

Rivian has an innate ability to slip on every banana peel laying around. It doesn't really matter if there was a supply-chain challenge, factory reset, market headwinds, EV slow down. They are fighting for their lives.

Fighting for your life is part-and-parcel of a start-up, I get that. The window to get this right is becoming more narrow. Profitibility in Q4 has been the 'mantra' for quite a while. They already know it is or isn't possible, but they have to play the market game.

I'm not sure the R2 is the 'solution'. I think the culture needs to pivot (now) and I'm not sure they can accept that in Normal. We love our Rivian's and to drive them, it is pure joy to both my wife and I. That doesn't blind me to challenges though.

Anyone conjure up a guess of how many trucks they are actually selling?

I'm with you in that I don't think the R2 won't be the magical savior if nothing changes with the challenges that Rivian is currently facing.

 

[Electron]

"As a result of the supply shortage, Rivian is revising its annual production guidance to be between 47,000 and 49,000 vehicles."

I assume your comment "played the excuse card" is regarding the above quote? I would typically agree with you, but given that they just retooled the line and had the Gen1 -> Gen2 changeover, it's plausible that a supplier failed to ramp up, OR Rivian failed to properly secure/confirm OEM quantities - which would obviously be their own fault and "supply shortage" is true but self-inflicted. Example: Rivian has new wheels for Gen 2. There were supplier constraints on certain wheels during Gen 1 ramp up.

Dunno, just saying it's plausible and not necessarily a fabricated excuse.

That is plausible, but given the current market conditions, hard numbers, the overall climate of the auto market and how even the competitors are doing makes me lean more toward seeing it as "an excuse card," being played here by Rivian.

Prime Example: Even Tesla is struggling so with that being the case there's no way Rivian who is an Ant in comparison to a Giant is out performing (not referring to overall volume) Tesla, growth wise.

That's what I meant about it being a cheap move. In my opinion it's really obvious to me.

I want Rivian to succeed, really do. If it was my call I would be offering the best incentives for my product in this wonky market that is about to get wonkier in the coming months.

 

[EVtowing]

The company produced 13,157 vehicles at its manufacturing facility in Normal, Illinois and delivered 10,018 vehicles during the same period. Rivian is experiencing a production disruption due to a shortage of a shared component on the R1 and RCV platforms.

I find it odd that there is such a disparity between the production and delivery numbers when a component shortage created a “production disruption” yet 31% more vehicles were “produced” than delivered.

My question is, were all 13,157 vehicles “produced” really completely finished and ready for delivery to customers? Or were some of them vehicles that went through the assembly line and would have been delivered except a single missing or defective part prevented them from being delivered?

It is possible to have a vehicle come off the line and be driveable but not ready for delivery because of an issue with a single part. Cars contain thousands of parts. A problem with just one of them can mean they are not ready for delivery to a customer.

Building cars at volume is hard, especially for a relatively young company. Tesla experienced multiple serious problems with volume production of the Model S and Model X and almost failed in 2017 when Model 3 production stalled for months due to the first assembly line failing. The company almost went bankrupt.

 

[Florida Panhandler]

I’m even talking about a partnership with a Chinese brand- namely Nio or Xpeng. It is clear by now that major Chinese brands are rapidly expanding and driving sales inside China and well beyond… major foreign automakers like Mercedes and Audi are being pushed out by demand. China would represent a huge market for Rivian along with access to the latest battery technology.

 

[DuoRivians]

I find it odd that there is such a disparity between the production and delivery numbers when a component shortage created a “production disruption” yet 31% more vehicles were “produced” than delivered.

My question is, were all 13,157 vehicles “produced” really completely finished and ready for delivery to customers? Or were some of them vehicles that went through the assembly line and would have been delivered except a single missing or defective part prevented them from being delivered?

It is possible to have a vehicle come off the line and be driveable but not ready for delivery because of an issue with a single part. Cars contain thousands of parts. A problem with just one of them can mean they are not ready for delivery to a customer.

Building cars at volume is hard, especially for a relatively young company. Tesla experienced multiple serious problems with volume production of the Model S and Model X and almost failed in 2017 when Model 3 production stalled for months due to the first assembly line failing. The company almost went bankrupt.

Rivian builds more for the Shop and often sells them in the next quarter. They’re expecting 3K more deliveries than production in Q4

 

[BigSkies]

I find it odd that there is such a disparity between the production and delivery numbers when a component shortage created a “production disruption” yet 31% more vehicles were “produced” than delivered.

My question is, were all 13,157 vehicles “produced” really completely finished and ready for delivery to customers? Or were some of them vehicles that went through the assembly line and would have been delivered except a single missing or defective part prevented them from being delivered?

It is possible to have a vehicle come off the line and be driveable but not ready for delivery because of an issue with a single part. Cars contain thousands of parts. A problem with just one of them can mean they are not ready for delivery to a customer.

Building cars at volume is hard, especially for a relatively young company. Tesla experienced multiple serious problems with volume production of the Model S and Model X and almost failed in 2017 when Model 3 production stalled for months due to the first assembly line failing. The company almost went bankrupt.

I recall this coming up around the last earnings call. They did say Q3 production and deliveries would be atypical because they were building back up inventory after the factory shutdown.

The low demand paranoia is just that. They re-affirmed deliveries while cutting production guidance. This means they’re going to blow through whatever inventory they’ve built up while production is cut.

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