A dose of good news for Rivian RIVN has shares of the EV truckmaker on the move.
The maker of electric pickups and SUVs reported it produced 7,363 units in Q 3 and delivered 6,584. The production total was 67% more than Q 2, when it produced 4,401 trucks. The company produced around 2,500 trucks in Q1.
RJ Scaringe is focusing on production gains and adding new shifts at the company's lone factory in Normal, Illinois. The company reiterated its 2022 annual goal of 25,000 vehicles produced for the quarter, despite component shortages the company noted earlier this year. Rivian s initial annual goal was 50,000 trucks produced, which it cut in half in March.
One Wall Street analyst isn't convinced that the stock is jumping on optimism.
RIVN believes it is on track to deliver on its prior 2022 production guidance of 25,000 units. According to CFRA analyst Garret Nelson, the production of 10,683 unit will improve in Q 4 and we continue to believe it will fall short.
Nelson believes that the current environment remains hard for EV companies because they are several years from reaching profitability. At least in the near term, Nelson said that the capital constraints, coupled with competition from established names like Ford, GM, and Tesla, will make it hard for Rivian to succeed and become profitable. The price target for the CFRA is 25 12 months and it has a Sell rating.
The company plans to build its cheaper R 2 series of vehicles in Georgia in the next two years, which is a big part of the growth story for the Rivian bulls. The plans were dealt a blow recently.
A judge in Morgan County denied $15 billion in bonds for construction of the plant in Rutledge, Georgia in a court ruling late last week.
Judge Brenda Trammell said Thursday that the Joint Development Authority JDA, an organization that seeks to draw businesses to the region, could not prove that the construction of the Rivian factory would be sound, reasonable, and feasible, so the company is not eligible for the bonds.
Judge Trammell ruled that Rivian would have to pay traditional property taxes, which it was originally excluded from paying.
JoEllen Artz, one of the organizers of the local opposition, said they were able to prove that they were only going to get $44 million the way the contract was written. If it was taxable, the two counties would get over $700 million in property taxes. The Georgia Department of Economic Development and the JDA said they would appeal the judge's decision.