A RIVIAN stock price prediction for the future is $53.2 per share. The Company is making progress in production and is part of an ever-expanding addressable market. Further, it is developing an ecosystem around its product that will benefit from recurring sales. Therefore, the stock has a bright future ahead.
Rivian’s high-cost base
Rivian’s stock price fell after the company’s third-quarter earnings call, where it announced that its production volumes in 2021 would fall short of its initial production goal of 1,200 vehicles. The company cited supply chain constraints as the reason. A chip shortage, which is still ongoing, has delayed production of the R1T pickup truck and R1S SUV. Meanwhile, the Federal Reserve shifted to a more hawkish stance, which isn’t helping the situation. The stock has since been hammered.
Rivian is an EV maker based in the U.S., but the company’s stock has been losing most of its value since it was initially listed in 2021. While the company’s IPO generated more than $11.9 billion in capital, the stock has struggled to perform well. However, as production and deliveries ramp up, Rivian’s stock price could rise.
Rivian’s stock is now public and is enrolled on the NYSE under the ticker code RIVN. Its cost base predicts a stock price prediction 2025 range of $185 to $230. The company is expected to hit its cost targets by the end of 2025. The company has a $16 billion market cap and is rapidly expanding.
Rivian is one of the few startups that has started production of its own EVs. Lucid Motors (LCID) doubled in the first four months after going public in July 2021, but has since pulled back to a $17 price. Lucid recently announced a memorandum of understanding with Mercedes-Benz to jointly develop EVs.
Rivian is shedding some of its workers. According to Bloomberg, the company is planning hundreds of layoffs this year, though the layoffs are not expected to affect manufacturing workers. The layoffs will affect about five percent of Rivian’s 14,000 employees. It has also scrapped a lower-cost trim of its R1S electric SUV. Instead, it will only offer a 7- seat version of the vehicle.
Company’s production is going well
Rivian has experienced a rough start in the stock market, with a lowered production estimate and supply chain disruptions. Despite these problems, the company has made some major changes to its production and development operations. Its most notable change is the recall of about 502 of its RT1 trucks, which represent about 10 percent of the company’s total production. The recall is related to a problem with the air bag deployment. If the air bag is not deployed properly, it could seriously injure a child in the event of a car crash.
While the company is facing challenges, Rivian is still confident that it will be able to produce at least 25,000 vehicles a year. Initially, the company had planned to reach a production capacity of 50,000 vehicles a year. In January to March, the company produced 2,553 vehicles and delivered 1,227 to customers. However, the company
is having some production problems due to increased material costs and logistical problems.
Since late last year, Rivian has produced 7,969 vehicles. The company doesn’t break down production numbers by model, but the R1T electric pickup truck and the R1S electric SUV are expected to make up the bulk of the company’s production. In addition, the company has also been producing delivery vans for Amazon. Overall, the company has been on track to meet its goal of producing 25,000 electric vehicles a year.
During the second quarter, Rivian’s production of the R1T and R1S jumped by 8% sequentially. With an accelerated production rate, the company is on track to meet its 2022 production target of 25,000 units. During the second half of this year, the company expects to double its production rate to 3,000 vehicles a month.
It’s part of a rapidly expanding addressable market
Rivian’s production ramp-up will be slow, with bumps along the way. However, the company will eventually hit its production targets and will grow at a compound annual rate of 52% through 2030. The company faces stiff competition in the automotive sector, as well as severe production problems and strained supply chains.
Rivian has raised $3.7 billion in funding from a variety of investors, including Amazon and Ford. It also has a manufacturing facility in Normal, Illinois, which was acquired from Mitsubishi in 2017. The plant has been upgraded to handle the production of modern electric vehicles, including drive units and battery cells. It also has the ability to manufacture DC fast chargers.
Rivian is also battling supply-chain problems that have slowed production and reduced margins. The company is now working on separating reservation procedures from the vehicle configuration process, which will make its products more transparent as far as pricing and timing are concerned. But its struggle with the ordering process reflects the larger challenges that the industry is facing. As a result, Rivian is burning cash like crazy. It’s currently spending $1.2 million per vehicle, and it expects to spend $7 billion in cash this year.
Rivian plans to launch several vehicles across a range of price ranges and segments. It will also add to its charging network and add additional services like insurance and autonomous driving. Time will tell if Rivian will be able to take advantage of these opportunities.
Rivian is a high-risk bet for investors. It faces stiff competition from mass-production automakers and electric carmaker Tesla. Ford, for example, is planning to introduce an all-electric version of its F-150 pickup truck next year. G.M. is working on an electric version of the Hummer, as well. Besides that, it’s working on an electric pickup truck based on its popular Chevrolet Silverado.
It’s working on an ecosystem to benefit from recurring sales
Rivian is a pioneer in electric vehicles and is working on an ecosystem that will benefit from recurring sales. It is targeting environmentally conscious consumers and adventurers, and its mission -driven CEO is developing a unique brand that will appeal to them. Its ecosystem includes a charging network and insurance services. Its main challenge, however, is that it does not yet have a meaningful competitive advantage. In addition, it is struggling to scale its manufacturing operations, and it faces stiff competition from Tesla and Ford.
The company is part of a rapidly growing market, which is set to boom in the next few decades. The company’s initial focus will be the North American market, where it believes that a BEV inflection point is imminent. The company estimates that 77% of U.S. light vehicle sales in 2021 will be trucks. This suggests that Rivian is on the verge of an opportunity to capture a large share of this market. As it moves beyond electric vehicles, it plans to build an ecosystem of products and services to benefit from recurring sales.
The company continues to burn through cash. As of June 30, 2018, it had produced 8,000 vehicles. Its goal is to make 25,000 vehicles by 2022. This number is relatively modest compared to the size of other automotive companies, such as Tesla, which produced 254,000 cars in Q2 of 2022 and Ford, which sold nearly four million vehicles in 2021. The company must also deal with real world economics, including inflation and supply chain problems.
Rivian’s Normal plant can produce approximately 150,000 vehicles per year, but it expects to increase that capacity to 200,000 vehicles per year by 2023. Additionally, the company is working on adding additional production facilities in Europe and the United States by 2024. By 2025, its overall production capacity will reach 500,000 vehicles annually.
It has a reputational problem
Rivian’s stock price has fallen almost 20% since its debut, and the company’s production problems have fed into pricing decisions throughout the entire sector. Even Tesla, which has raised the price of entry-level electric cars for five of the last six months, has rolled back some price increases. Though the company’s stock price may rise once more with the launch of new models, its reputation has suffered greatly as a result.
Rivian’s stock price prediction 2025 depends on the fundamentals of the company. According to analysts, the company is on track to deliver 290,000 vehicles by 2025, and a projected seven hundred thousand by 2030. Rivian’s shares could reach a high of $78.5 billion by 2030 if the company’s current sales pace is maintained.
Although Rivian is still growing, its cash burn continues to be quite high. In the first half of 2022, the company produced only 8,000 vehicles, compared to a target of 25,000 by the end of the year. However, this number pales in comparison to its rivals – Tesla, for example, produced 254,000 vehicles in Q2 of 2022. Ford, meanwhile, sold more than four million cars in the same period. Rivian also has to contend with the realities of supply chain and inflation, which can make the company’s production plans unsustainable.
Despite its strong growth trajectory, the company is a highly volatile stock. The company continues to burn cash aggressively, and the stock price may fall over time if it continues to miss its revenue target. The company’s management blames this
on supply chain and inflationary pressures, as well as high costs.