Rivian misses Q4 delivery estimates, but beats 2023 annual production forecast

[Dark-Fx]

I don’t think this is entirely true. Otherwise, why would Rivian call out that EDVs deliveries in Q4 will be lower because Amazon takes fewer vans during the holiday season

I believe part of the Amazon contract that hasn't been made public states how many vans Rivian is expected to keep on the lot. They know those numbers ahead of time so should be part of their production and delivery forecasting. If Amazon isn't taking the vans off the lot, Rivian should be slowing production on them as forecasted during that time period. The end of the exclusivity contract, to me, points to Amazon's take rate being less than the original contract expected.

Since Rivian hasn't broken down the actual numbers based off of vehicle line, the investors are sort of left to make assumptions about the product mix.

We know Rivian is having issues moving the R1T inventory because they have started incentives on them, and you can take delivery in 1-2 weeks.

Sponsored

 

[carsly]

Lower prices but give those of us who paid more some free charging up to the amount of the price cut please.

That's not really how businesses work.

If you go to [fill in clothing store here] to buy a shirt for $49 and it goes on sale two months later for $39 do they give you $10 back? How about if you buy a new [fill in compact SUV here] for $40K and there is a dealer rebate a month later for $2,000 do you get that money back?

If you want something at a price offered, then buy it. Otherwise, wait and see, prices can (and do) go up and down all the time for just about everything - gasoline, milk, clothing, toothbrushes, sneakers, paint, lumber, whatever.

 

[Mark_AZR1T]

For months the guidance (even recent) was 54,000 deliveries. This is disappointing. The market conditions for $80K-$110K EV's in volume is simply not there. I'm in the pool, that a price reduction for the R1T timing is here and now and as others have noted you need to be able to purchase an R1S, Dual Motor with a decent color combination for under $80K.

 

[jjswan33]

For months the guidance (even recent) was 54,000 deliveries. This is disappointing. The market conditions for $80K-$110K EV's in volume is simply not there. I'm in the pool, that a price reduction for the R1T timing is here and now and as others have noted you need to be able to purchase an R1S, Dual Motor with a decent color combination for under $80K.

They have been saying they would produce 54k vehicles not deliver, they produced 57k so they beat that target. The other speculation today was consensus was they were going to deliver 14k vehicles in Q4 and they delivered 13,972.

Honestly it doesn't seem like a 10% drop is due solely to missing Q4 deliveries by less than 30 vehicles. This more seems like the market wanted them to beat the number handily and they just met it or just selling the news rather than anything else.

 

[Yellow5]

Not the best news today, but still a good quarter of production occurred. With softening rates additional apatite from the market will naturally follow. The automotive industry at large is in a somewhat rough spot with the very high loan rates that new customers face. I expect that to change a bit this year and a bit more next year.

A 10% drop isn't great, and is likely an overreaction as the market tends to do with Rivian (on both ends). The stock wasn't priced to perfection before and took many hits as a result of softening demand throughout the industry in Q4 2023, having a bit of that hit the books isn't all that surprising.

In the end, the R2 model lineup release (hopefully within the next 90 days) will go well and people will forget a small miss on deliveries in Q4 2023. We play the long game as investors and the story is in the first couple chapters. All the foreshadowing is good. No company meets goals every quarter unless they set the bar low intentionally.

 

[husky337]

Exactly my thoughts. Saw the numbers this AM and thought no way that could justify the 10% drop by a miss of *28* on deliveries, with a *beat* on production... C'est la vie..

They have been saying they would produce 54k vehicles not deliver, they produced 57k so they beat that target. The other speculation today was consensus was they were going to deliver 14k vehicles in Q4 and they delivered 13,972.

Honestly it doesn't seem like a 10% drop is due solely to missing Q4 deliveries by less than 30 vehicles. This more seems like the market wanted them to beat the number handily and they just met it or just selling the news rather than anything else.

 

[Hillbilly]

That's not really how businesses work.

If you go to [fill in clothing store here] to buy a shirt for $49 and it goes on sale two months later for $39 do they give you $10 back? How about if you buy a new [fill in compact SUV here] for $40K and there is a dealer rebate a month later for $2,000 do you get that money back?

If you want something at a price offered, then buy it. Otherwise, wait and see, prices can (and do) go up and down all the time for just about everything - gasoline, milk, clothing, toothbrushes, sneakers, paint, lumber, whatever.

Thanks. I forgot everything I learned when I graduated with honors and a degree in economics.

I'm strictly talking about them offering something in the form of goodwill to the customers that paid the premium pricing.

 

[Rob Stark]

Rivian prices are higher in Canada that just a straight currency conversion. Rivian should lower prices to comparable US prices.

Rivian opened up a service center in Germany recently.

Rivian should open sales in Australia too.

Opening new markets is preferable to price cuts in the USA. It hurts the bottom line and resale value for current customers.

 

[Mark_AZR1T]

They have been saying they would produce 54k vehicles not deliver, they produced 57k so they beat that target. The other speculation today was consensus was they were going to deliver 14k vehicles in Q4 and they delivered 13,972.

Honestly it doesn't seem like a 10% drop is due solely to missing Q4 deliveries by less than 30 vehicles. This more seems like the market wanted them to beat the number handily and they just met it or just selling the news rather than anything else.

Noted. Do we have a breakdown on product mix of EDV, R1T and R1S Q4 production, as well as, the product mix of the 3,000 that were not delivered?

 

[carsly]

Thanks. I forgot everything I learned when I graduated with honors and a degree in economics.

I'm strictly talking about them offering something in the form of goodwill to the customers that paid the premium pricing.

LOL, perhaps I was too snarky for the first working day of the year. Apologies.

I just don't see them adding expense in the current period for orders that have already been fulfilled and revenue recognized. It would hurt their margins now, which would already get squeezed with lower prices. How do you see the win for Rivian?

Maybe a $1,000 credit on your next Rivian (purchased before year-end 2024) for a successful referral?

 

[DuoRivians]

They have been saying they would produce 54k vehicles not deliver, they produced 57k so they beat that target. The other speculation today was consensus was they were going to deliver 14k vehicles in Q4 and they delivered 13,972.

Honestly it doesn't seem like a 10% drop is due solely to missing Q4 deliveries by less than 30 vehicles. This more seems like the market wanted them to beat the number handily and they just met it or just selling the news rather than anything else.

Exactly.

This drone footage counts well over 1,000 EDVs awaiting delivery. If Amazon had taken delivery in Q4, which they gave a reason why they didn’t, deliveries would have beaten expectations handedily.

In other words, this should sort itself out soon.

 

[R1TS]

1. It’s not EV9 competition
2. Rivian isn’t going to lower prices.
3. The gap is most likely from fewer EDVs delivered this quarter, as warned by the team last earnings:

There’s a gap of about 3,500 vehicles, or 20% of what they produced. That’s not just mostly from EDVs. There’s just less people wanting a Rivian now.

 

[R1TS]

They have been saying they would produce 54k vehicles not deliver, they produced 57k so they beat that target. The other speculation today was consensus was they were going to deliver 14k vehicles in Q4 and they delivered 13,972.

Honestly it doesn't seem like a 10% drop is due solely to missing Q4 deliveries by less than 30 vehicles. This more seems like the market wanted them to beat the number handily and they just met it or just selling the news rather than anything else.

The consensus may have been 14k deliveries, but the report also shows that deliveries were 10% lower than previous Q. Plus the 20% difference between production and deliveries this latest Q. This is why the stock is down.

 

[Zoidz]

Exactly.

This drone footage counts well over 1,000 EDVs awaiting delivery. If Amazon had taken delivery in Q4, which they gave a reason why they didn’t, deliveries would have beaten expectations handedily.

In other words, this should sort itself out soon.

Did Amazon specifically say they did not take delivery?

As @Dark-Fx stated in an earlier comment, by contractual agreement with Amazon, the Amazon EDVs are considered delivered as soon as they hit the Normal parking lot. That is Amazon's delivery location. There's another thread around here somewhere from a year or so ago that has the contractual wording in it. So, unless those EDVs have defects and are on hold, they are in theory already delivered and have been counted.

 

[DuoRivians]

Did Amazon specifically say they did not take delivery?

As @Dark-Fx stated in an earlier comment, by contractual agreement with Amazon, the Amazon EDVs are considered delivered as soon as they hit the Normal parking lot. That is Amazon's delivery location. There's another thread around here somewhere from a year or so ago that has the contractual wording in it. So, unless those EDVs have defects and are on hold, they are in theory already delivered and have been counted.

Yes, from Rivian’s Q3 earnings call. They specifically mention why the gap between P/D will be greater in Q4 and why:

I don’t think the Amazon EDVs as automatically considered delivered holds true

Sponsored