Rivian founder and CEO RJ Scaringe has snapped up $US1 million worth of the EV maker’s shares, a new security filing shows.
The proxy filing shows Scaringe bought 41,000 units of Class A common stock on Monday. The purchase follows Ford’s sale of 8 million shares in early May. The sale decreased its total holdings from 12% to less than 10%.
That sale pushed the value of Rivian down a whopping 17%. Last Wednesday, Rivian shares hit an all-time low of $US20.60.
The latest fluctuations are heavy news for the EV maker, which has started delivering its rugged R1T electric pickup (ute) and R1S SUV to customers.
The brand has captured attention with its can-do design. Winning features include big batteries, lots of ground clearance, vehicle-to-load and a gear tunnel.
These credentials have sparked much interest in Australia also. However, though Rivian has Australia pegged as a key market, it could still be some years before the EV maker arrives locally.
When the EV maker debuted in late 2021, it became the sixth most valuable carmaker by market cap. Fuelled by confidence in the backing of the company by Ford and Amazon, the company’s share price reached a top of $US179.47 a week after its debut.
No doubt the success of Tesla had many believing that Rivian could be the next big EV startup success story. However, since then, its value has fallen some 75% as a string of material disclosures cool investor sentiment.
Seat supplier lawsuit
The latest filing also comes as share prices fell again on Monday after a short rally. The fall came as the company filed a lawsuit against Commercial Vehicle Group, which is to supply seats for the Amazon van.
A filing with the Wayne county court in Michigan claims the seat supplier breached a contract and doubled prices for the electric van custom seats.
Rivian said in the filing it will not be able to fulfill its order to Amazon for 100,000 electric vans if the complaint is not resolved, Wall Street Journal reported.
Slow ramp up unsurprising
It’s not easy to discern a long-term outlook for Rivian at the current time. Certainly, the EV startup has big boots to fill and it’s not surprising that it is running into some hurdles.
But global chip shortages and other supply chain constraints are conspiring to stymie the startups big goals further. It initially gave guidance for 50,000 units production in 2022 but has had to halve this.
“Supply chain continues to be the bottleneck of our production,” said Rivian in its May earnings letter to shareholders.
Bridie Schmidt is associate editor for The Driven, sister site of Renew Economy. She has been writing about electric vehicles since 2018, and has a keen interest in the role that zero-emissions transport has to play in sustainability. She has participated in podcasts such as Download This Show with Marc Fennell and Shirtloads of Science with Karl Kruszelnicki and is co-organiser of the Northern Rivers Electric Vehicle Forum. Bridie also owns a Tesla Model Y and has it available for hire on evee.com.au.