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Donald Stanfield

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I don't see how this is a bad thing for Rivian. A one sided contract that benefited Amazon wasn't the greatest thing for Rivian, but that's all a long shot upstart can get. The original contract was for 100K vehicles over 10 years which is 10K a year. Amazon isn't taking any less than they planned.

With that said Rivian wanting out of exclusivity says that they can make more than 10K of these vans and they want to sell the remainder on the open market. That's a good thing folks. Maybe you could argue that it means demand for the R1 is cooling and therefore they are trying to supplement with EDVs but even that is a fairly speculative argument based on known factors.

For those saying that the street doesn't like this as evidenced by the stock price, the whole market is getting bent over today because of those THREE banks folding up. So much so that there's speculation of the fed not going as aggressive on interest rates as they talked about just weeks ago. The dive has very little to do with Rivian itself and much more to do with traders getting really gun shy over a huge potential recession.

Honestly though the market beatings were both forecast and needed. You guys do realize that money doesn't really exist the way we all think it does right? The price for everything is purely speculative and based on what everyone all agrees stuff is worth. Right now the demand is far too hot to be realistic and the only way to fix that is to make everyone worried. That's what's happening, but the only thing different between most people and the few who make money in the market are the ones who can see through the smoke and mirrors and think for themselves.

On that token I have seen no explanation that makes sense as to how Rivian trying to open up their market options is bad for Rivian.
 

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If they can make them with a legit 300+ miles in range, the conversion market would be huge. Think Mercedes Sprinter Van. These could be people movers. Class B RV conversions. Not to mention the thousands of other companies that use delivery vans that could switch over. For delivery service, probably don't need more range. But for the public, most would want a more usable travel range, which should be easy enough to do. If they opened it up to all of the above, Rivian would have a backlog for years and years.
 

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It's not like the market had some meltdown today. Other EV stocks barely moved. If this change in pact with Amazon was truly beneficial for RIVN the stock would have at least risen.

As WSJ pointed out, the agreement was viewed favorable by investors by providing an endorsement and some financial stability.
 

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It's not like the market had some meltdown today. Other EV stocks barely moved. If this change in pact with Amazon was truly beneficial for RIVN the stock would have at least risen.

As WSJ pointed out, the agreement was viewed favorable by investors by providing an endorsement and some financial stability.
Announcing talks doesn't really tell us anything aside from the fact that Amazon isn't buying a lot which is obviously bad for Rivian.

So the information that can be acted on today is bad news.

I'll wait for the ACTUAL announcement to make any stock buying decisions.
 

SANZC02

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It's not like the market had some meltdown today. Other EV stocks barely moved. If this change in pact with Amazon was truly beneficial for RIVN the stock would have at least risen.

As WSJ pointed out, the agreement was viewed favorable by investors by providing an endorsement and some financial stability.
But it would be more favorable without the exclusive deal. Amazon only wants around 10k a year. Rivian has stated that plant is set for a 55/45 split of R1/EDV so they want to build more than 67k a year. Amazon is not backing out of the purchase portion and are still committed to the initial 100k, this just removes the constraint so they can build more.

There were thousands on the lot at the factory waiting for Amazon. If I were Amazon, I would leave terminology in where they get first rights up to X number a year and let Rivian make other deals for the rest of the capacity. That is a Win/Win for Amazon based on their percentage of Rivian stock.
 

jjswan33

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But it would be more favorable without the exclusive deal. Amazon only wants around 10k a year. Rivian has stated that plant is set for a 55/45 split of R1/EDV so they want to build more than 67k a year. Amazon is not backing out of the purchase portion and are still committed to the initial 100k, this just removes the constraint so they can build more.

There were thousands on the lot at the factory waiting for Amazon. If I were Amazon, I would leave terminology in where they get first rights up to X number a year and let Rivian make other deals for the rest of the capacity. That is a Win/Win for Amazon based on their percentage of Rivian stock.
Not to mention the existing contract is cost+ so if Rivian is not able to utilize the full capacity that drives up the cost per van for Amazon as well.
 

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Looking forward to the day Rivian can drop Alexa and add Apple Car Play - I don't know one person who prefers Amazon software over Apple's Car play- hopefully the day is coming soon....
 

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Imo, this isn't good for Rivian at all. I see it as a major loss of confidence from a extremely well known customer. The loss of the exclusivity PR is another hit.
I would agree with you about the spin being put on a lot of other news here, but I don't think it's the case with this one.

Amazon is coming out of a pandemic boom and business is rolling back. Hell, I hardly EVER buy anything there anymore. They've recently stopped construction of HQ2 here in VA and they're firing a bunch of people. It makes sense then, that they might be dialing back the number of vans they're purchasing from all sources. And if they're only going to take the contractural minimum this year, it would be a good thing if Rivian at least has the option to sell their capacity elsewhere.

Rivian is just in the wrong grove right now, and any news is bad news.
 

jjswan33

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Looking forward to the day Rivian can drop Alexa and add Apple Car Play - I don't know one person who prefers Amazon software over Apple's Car play- hopefully the day is coming soon....
Rivian's current software doesn't have anything to do with including/not including Apple Car Play.
 

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It's in Amazon's own interest, as a major stakeholder, for Rivian to sell its vans to others if they are not going to purchase all of them. I'm sure they will work it out.
 

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If it hasn't been mentioned already, the fear is that Amazon will reduce their Rivian stock holdings the way Ford did. WS is reading between the lines of reduced delivery commitment for 2023 and willingness to renegotiate exclusivity.

While getting rid of exclusive arrangement sounds a plus for Rivian, it assumes that there are other buyers for EDV, at the pace Rivian can make them. Maybe...maybe not.

The way many Amazon delivers goods is that they use contracted delivery services companies that wear Amazon logo and colors. Amazon buys the vans and these businesses lease it from Amazon. An interesting business model. You would never know they are not directly employed by Amazon.

The delivery of 10k vehicles for 2023 is a function of Amazon needing to mange their expenditures. As such, it is natural for Rivian to want to sell their products (excess capacity for this year). GM/Brightdrop, Ram and even Canoo are selling their vehicles for commercial use. Rivian is betting that they can deliver to new customers this year.

Rivian management will most likely face some activist investor sooner than later to challenge their board members and potentially restructure the C-Suite at the company. The stock price has taken a beating since the disappointing production forecast (everyone is expecting 62k now regardless of what is "official"), debt offering with potential dilution by use of convertible note, now Amazon story. All of this on the top of demand question (pulled backlog off the website and the earnings call), and high interest rate on auto loans in the inflationary environment.
 

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Rivian's current software doesn't have anything to do with including/not including Apple Car Play.
The fact is Rivian does not have Apple Car Play. Whether or not this is because of software or a legal agreement with Amazon I don't know. I think it's fair to say most people would rather have Apple Car Play. Maybe someone who knows more than me can explain why Rivian doesn't have Apple Car Play....
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