Aftermarket trading of the new carmaker Rivian Automotive plummeted by over 17%! In Q4, they are losing $40,000 for every car delivered.

Zhitong App has learned that the American electric vehicle newcomer Rivian Automotive has announced plans to cut 10% of its salaried employees and has set production guidance well below Wall Street's expectations. This emerging force in the electric vehicle industry is striving to cope with cooling demand and economic turbulence. According to a performance forecast released on Wednesday, the company is expected to produce approximately 57,000 vehicles this year, roughly in line with the production volume in 2023. However, this forecast is significantly lower than the average forecast of over 80,000 vehicles by Wall Street analysts for 2024.

The electric vehicle company, headquartered in Irvine, California, reported an adjusted loss per share of $1.36 in the last quarter, slightly higher than the analysts' average forecast of a loss of $1.33 per share. The total revenue for the last quarter reached $1.32 billion, slightly higher than the analysts' average expectations.

In the last three months of 2023, Rivian Automotive was losing over $40,000 for every vehicle delivered, which is more than the significant loss of over $30,000 per vehicle in the third quarter. The company attributed this to a decrease in the number of low-cost delivery vans sent to Amazon. Compared to a loss of $124,000 per vehicle a year ago due to supply chain issues, the quarterly loss has significantly improved.

Regarding production and delivery data for the fourth quarter, Rivian Automotive reported in its earnings report that they produced 17,541 vehicles and delivered 13,972 vehicles in the fourth quarter. Throughout the 2023 fiscal year, Rivian Automotive produced 57,232 vehicles and delivered 50,122 vehicles.

Another newcomer to the electric vehicle market in recent years, Lucid Group (LCID.US), stated that they expect to produce 9,000 vehicles this year, slightly higher than the production volume of just under 8,500 vehicles last year. However, this was not enough to prevent its stock price from dropping nearly 10% in after-hours trading on the US stock market. The company, headquartered in Newark, California, reported a loss of 29 cents per share in the fourth quarter, with a net loss expanding from $472.6 million in the same period last year to $653.8 million. Nevertheless, the company stated that it has sufficient cash flow to "last at least until 2025."

RJ Scaringe, CEO of Rivian Automotive, stated in a conference call, "Our business is not immune to the negative impact of current economic and geopolitical uncertainties." "Most notably, the impact of historically high interest rates has had a negative effect on demand."

Due to production levels significantly below Wall Street's expectations, Rivian Automotive's stock price fell over 17% in after-hours trading to $12.71. At the close of the U.S. stock market on Wednesday, Rivian Automotive's stock price closed at $15.39, marking a cumulative decline of about 34% this year.

Wall Street analysts' views on Tesla and the overall electric vehicle sector in the U.S. stock market are rapidly deteriorating, mainly due to signs of slowing electric vehicle sales growth under high interest rate pressure, and the gradual depletion of government incentives for electric vehicles worldwide.

Data compiled by institutions shows that over the past year, Wall Street analysts' average profit expectations for Tesla in the next 12 months have declined by over 20%, while during the same period, the overall profit expectations for the S&P 500 Index have increased by 6%. The consensus rating score for this electric vehicle manufacturer is approaching its lowest level in nearly two years.

In other forecasts, Rivian Automotive expects an adjusted pre-tax loss of about $2.7 billion for the full year.

The outlook provided by Rivian Automotive highlights the challenges it faces in expanding production scale and curbing losses in an environment where consumer demand for battery-powered electric vehicles is weakening. Since its listing on the U.S. stock market in 2021, this electric vehicle manufacturer's goal has been to challenge Tesla, the leader in the electric vehicle market. However, it has been grappling with challenges such as supply chain issues and demand since then.

Following extensive layoffs last year and in 2022, this round of layoffs is part of Rivian Automotive's more proactive cost-cutting efforts. The company had previously stated that its capital expenditures for this year would increase from slightly over $1 billion in 2023 to over $1.7 billion. The initial estimate for total spending was around $2 billion.

Rivian Automotive's CFO, Claire McDonough, told Wall Street analysts during a conference call that the improvement in electric vehicle production efficiency allows the company to control capital expenditures.

Rivian Automotive operates its only factory in Normal, Illinois, producing two consumer-grade electric vehicles and an all-electric truck. The company also has a car manufacturing plant under construction near Atlanta, planning to start producing its first mass-market affordable electric vehicle there from 2026 onwards.