(Portal) – Rivian Automotive missed market estimates for fourth-quarter deliveries as tough competition and high interest rates weighed on demand for its electric vehicles, and the company's shares fell 10% on Tuesday.
The company delivered 13,972 vehicles in the final three months of 2023, down 10% from the previous quarter and below estimates of 14,430, according to 13 analysts surveyed by Visible Alpha.
High interest rates in the US have increased monthly payments for electric vehicles, making them less affordable and sparking a price war for market leader Tesla.
Amazon.com, Rivian's largest supporter and major customer, is also not taking deliveries in the fourth quarter as it focuses on the holiday season.
“It is likely that the holiday plans slowed deliveries versus production,” said Vitaly Golomb, a Rivian investor and electric and autonomous mobility expert.
Rivian produced 17,541 vehicles in the last three months of 2023, up 7.5% from the previous quarter. This increased annual production to 57,232 units, exceeding the forecast of 54,000.
Tesla also reported quarterly deliveries on Tuesday, with the company beating market estimates and hitting its full-year target.
While an earlier-than-expected bond offering in October sent Rivian's stock plummeting on fears about its financial health, the company is widely seen as better positioned among EV startups like Lucid and Fisker.
Rivian has so far avoided lowering the prices of its vehicles, instead relying on sustainable demand.
The company signed a deal for its electric vehicles with U.S. wireless carrier AT&T last month, its first after its exclusive deal with Amazon ended in November.
Some analysts said Tuesday that the Rivian R1T pickup, which starts at $73,000, is unlikely to face much competition from Tesla's Cybertruck, which was unveiled in late November.
(Reporting by Zaheer Kachwala in Bengaluru; Editing by Krishna Chandra Eluri)