Rivian plans to sell electric trucks to customers other than Amazon
Rivian plans to sell electric trucks to customers other than Amazon. The second-quarter results show that Rivian still loses thousands of dollars for every vehicle produced, but the company is slowly moving towards profitability and positive cash flow. Wall Street analysts are optimistic about Rivian, calling it a long-term winner in the transition from internal combustion engine vehicles to electric vehicles. Volkswagen's strategic partnership and investment are also seen as positive factors for Rivian. Overall, Rivian plans to expand electric truck sales and make positive progress in performance and investment
According to the financial news app Zhitong Finance, on Wednesday, Rivian (RIVN.US) announced its second-quarter performance and revealed during the subsequent earnings conference call that the company is focusing on selling electric delivery vans to customers other than Amazon (AMZN.US).
Rivian's management expressed their anticipation to start negotiations with other electric delivery van (EDV) customers beyond Amazon. CEO RJ Scaringe stated that the company has been conducting pilots as it anticipates significant growth in EDVs by 2025.
"The focus on pilots really reflects the nature of this business, where many large fleets need to make significant decisions around a large number of vehicles. We are building effective models to understand how vehicles are serviced, digitally supported, and what infrastructure changes each fleet needs are appropriate."
Ford (F.US) is the largest electric delivery van seller in the United States. Meanwhile, Tesla (TSLA.US) has hinted in the past about producing electric delivery vans, to the extent that some electric vehicle observers believe this could become part of the concept of autonomous ride-hailing.
Second-quarter performance well received
Rivian's second-quarter performance shows that the company still loses thousands of dollars for every vehicle produced. However, the management continues to emphasize that the company is slowly progressing towards profitability and positive cash flow.
After the financial report was released, Wall Street analysts also gave optimistic views.
Needham reiterated its "Buy" rating on Rivian. Analyst Chris Pierce and his team continue to view Rivian as a long-term winner in the transition from internal combustion engine vehicles to electric vehicles, as the company leverages the high satisfaction of R1 owners and its partnership with Amazon's delivery van demand. Volkswagen (VWAGY.US)'s recent strategic partnerships and planned investments, ongoing production efficiency, and supplier leverage are all seen as positive factors for Rivian.
Evercore ISI analyst Chris McNally is optimistic about Rivian's liquidity position. He emphasized that after establishing a joint venture with Volkswagen, the company's total liquidity will reach $9.2 billion. This figure does not include the remaining $4 billion in the final agreement of the joint venture. McNally and his team believe that Rivian's liquidity position is at least sufficient to sustain until 2027, or close to when the company expects positive free cash flow.
Wedbush Securities maintains its "Outperform" rating on Rivian and sets a target price of $20. Analyst Dan Ives stated, "While profitability remains the focus on Wall Street, it now feels like the company is on the right path, bringing a clear future vision for automakers and will continue to check off issues on the list to build trust."
UBS analyst Joseph Spak believes Rivian is on the right track, but considering the delivery pace and factory shutdowns in 2025, he lowered the target price to $16