Rivian Automotive, Inc.’s (NASDAQ:RIVN) otherwise good week ended with some bad tidings for the electric vehicle manufacturer.
What Happened: Rivian announced a voluntary recall of the EVs it delivered to customers after it identified issues with a fastener, according to a letter sent by CEO R.J. Scaringe to customers, which Benzinga has viewed. In rare circumstances, the nut could loosen fully, he added.
“While we’ve only seen seven reports potentially related to this issue across our fleet to data, even one is too many,” he added.
Beginning in the fourth quarter of 2021, the company has thus far delivered 13,198 EVs.
Rivian currently manufactures the R1T electric pickup truck, the R1S SUV, and the EV delivery van it has been contracted to supply to Amazon, Inc. (NASDAQ:AMZN).
The company said customer safety is its top priority and that it is committed to fixing the issue as quickly as possible and free of charge at one of its service centers. The official recall notice is being posted by the National Highways Traffic Safety Administration on Saturday, the CEO’s letter said.
Scaringe said in the letter that the rectification – tightening the fastener to a higher torque tolerance, will only take a few minutes and in some cases, the part may have to be replaced.
A Rivian spokesperson told Benzinga in an emailed statement that the company has built enough capacity to complete the needed action in about 30 days.
“To date, we are not aware of any injuries that have resulted from this issue,” the spokesperson added.
See also: Rivian Is Finally Starting To Turn The Corner, Analyst Says Ahead Of Q2 Results
Why It’s Important: Rivian is among the EV startups, which have managed to move to commercial manufacturing, and its electric pickup truck beat industry titans such as Tesla, Inc. (NASDAQ:TSLA) and Ford Motor Company (NYSE:F) to the finish line.
After initial hiccups due to supply-chain challenges, which forced Rivian to halve its production forecast for 2022, it was slowly and steadily making headway in the EV arena. Earlier this week, the company reported third-quarter production and deliveries of 7,363 vehicles and 6,584 vehicles, respectively, and also affirmed its full-year production guidance of 25,000 units.
Even as most other EV stocks fell along with the broader market, Rivian was among those which outperformed, gaining 3.2% for the week. The recall news, which was reported after the market closed on Friday, could trigger some near-term weakness in the stock, although the company has downplayed it as a minor “structural defect.”
Rivian closed Friday’s session down 7.64% at $33.95, according to Benzinga Pro data.
Photo: Courtesy of rivian.com
