Rivian is an electric vehicle manufacturer American company that is on a mission to keep the world adventurous forever. In the last few years, Rivian became the most famous electric car and gained very much profit from the highly anticipated selling of the car. According to a report, Rivian’s operating expenses rose 73% to over $1 billion, compared to $580 million in Q2 2021 and nearly quadruple the $95 million in the first quarter of 2022. After this profit, Rivin was expecting more profit in the revenue of the 2nd quarter but there is bad news for the Rivian lovers.
according to the report the company had faced a situation of loss. Yes, it’s true Rivian has reported a net loss of $1.71 billion in the second quarter of 2022 based on $364 million in revenue. The company expected a high speed in the revenue of 2nd quarter in comparison to 1st quarter but if we try to compare the previous report of the company revenue so Rivian reported a net loss of $1.59 billion based on $95 million in revenue. Still, the company beat Wall Street’s expectations for revenue by about $26 million.
Not even this the company’s earning report has also signified that the company is still trying to achieve the overall goals and try to get the rather revenue that is rather to get by the company so that is why the automakers are tight their seatbelt and start focusing on a ways to go before it can deliver on its promise to upend the auto industry with beautifully designed, emissions-free, adventure-themed trucks and SUVs. The supervision said that we are expecting to burn through $700 million in additional cash before the end of the year.
If we talk about the overall report so there are so many promises about the updating in the Rivian performance. The company has committed a statement that we made 4,500 vehicles during the three-month period, a 75 percent increase over the previous quarter, and delivered 4,567 vehicles, a 277 percent increase. Even the company is also except that they delayed and didn’t provide a breakdown between R1T trucks and its electric delivery van (EDV) that is being built for Amazon.
Why Rivian faces the loss in the 2nd quarter of 2022.
So according to the reviews of the buyers and the users of the Rivian, there are so much expensive functions in the car which the buyers used to pay if they want to prepare and the main point of the loss is the huge bump in the price of the car. There is one comment where a buyer who was want to buy the car this time but wasn’t able to buy the car due to high profile prices of the car. He states that the prices of the car were higher than in the 1st quarter. Not even this the company has also delayed the expected function which was demanded by the users for so long.
PRODUCTION UPDATING REPORTS AFTER EARNING REPORTS COMES ON HEELS
Well, here we must say that the company becomes more alert after getting the result of 2nd quarter report and focusing on the production of the cars. as according to the report company will still need to churn out 18,046 vehicles over the next eight months if it’s to meet its goal of 25,000 built this year, or roughly 9,023 vehicles per quarter. The company has claimed that now the reservation of the cars becomes
91,000 for the R1T and R1S vehicles and in a few days this count is also increased and becomes 99,000 reservations.
Last month Wedbush’s Dan Ives said that Rivian was showing some improvement after experiencing “major issues out of the gates,” Rivian is “starting to find their sea legs,” Ives wrote in a note, adding that the company has the potential “to be a major EV stalwart over the next decade.” Still, the company has worked so hard in order to reach its goals this year and laid off around 6 percent of its 14,000 employees, or around 800 people, citing a need to cut costs in order to speed up the development of future versions of its electric trucks and SUVs.
After finding out about the customer’s angry reaction due to the expensive price of Rivian and hike in the price Rivian scramble to respond and state that the new climate bill put forward by Senate Democrats, pricier EVs (sedans that are over $55,000 for new cars and pickup trucks and SUVs over $80,000) would be ineligible for the $7,500 tax credit.
CEO to issue a public apology after the issue became so sarcastic when it is clear that the Rivian’s electric truck and SUV will be too expensive in order to qualify for the credit which may harshly affect the demand. Not even this Rivian also bumped up the prices on both of its models by 20 percent, sending its stock price tumbling.
After watching such circumstances the company directly comes in front of the customers and starts sending e-mails in order to post the response on its website advising them to sign a “binding contract” before the bill goes into effect in order to lock in their $7,500 tax credit. Anyways the company has reported that they have 16.5 billion in cash on hand. That’ll be very helpful for the automaker if it’s expecting even bigger losses for the year.
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Well, that was all about this article. According to me, the price is the main factor on which the demand and supply, profit and loss are completely based. And this time Rivian did the same mistake to increase the price of their car. I think this decision can affect the profit of the 3rd quarter if they didn’t focus on the prices of the cars. Anyways whatever is happened we can only hope for the best and want to beat things for both buyers and the company as well.