Rivian Disappoints with 2025 Delivery Forecast; Stock Falls

The electric vehicle company reported that it expects to deliver between 46,000-51,000 vehicles, lower than analysts' expectations of 55,000 deliveries. While the company posted strong results for Q4, including its first-ever gross profit, it also mentioned it expects challenges this year due to tariffs and the elimination of the US tax credit.

Rivian Automotive’s stock fell 4.3% on Wall Street after the earnings report. Despite strong results for Q4, the company’s outlook for 2025 has raised concerns among investors. The company is forecasting deliveries between 46,000-51,000 vehicles this year, compared to the analyst estimate of 55,000 vehicles. It also pointed out that it expects difficulties due to tariffs and the ongoing trade war, as well as the elimination of the tax credit in the US, which had allowed buyers to benefit from a $7,500 tax incentive when purchasing an electric vehicle.

The electric vehicle company reported that it expects to deliver between 46,000-51,000 vehicles, lower than analysts' expectations of 55,000 deliveries. While the company posted strong results for Q4, including its first-ever gross profit, it also mentioned it expects challenges this year due to tariffs and the elimination of the US tax credit.

Rivian Automotive’s stock fell 4.3% on Wall Street after the earnings report. Despite strong results for Q4, the company’s outlook for 2025 has raised concerns among investors. The company is forecasting deliveries between 46,000-51,000 vehicles this year, compared to the analyst estimate of 55,000 vehicles. It also pointed out that it expects difficulties due to tariffs and the ongoing trade war, as well as the elimination of the tax credit in the US, which had allowed buyers to benefit from a $7,500 tax incentive when purchasing an electric vehicle.

Tariffs and the Elimination of the Tax Credit Cast a Shadow Over the Year Ahead

Rivian is facing a cloud of uncertainty over the coming year. Under the Trump administration, there has been a push to increase tariffs on products from China, including key components used by US electric vehicle manufacturers. Rivian, like other manufacturers, depends on parts produced in China, particularly batteries and electronic components. An increase in tariffs will lead to higher production costs, which will either force the company to raise vehicle prices or absorb the costs at the expense of profitability.

Investors are concerned that Rivian, while having posted a gross profit in the last quarter, still hasn’t reached a net profit, and will struggle to handle rising costs as competition in the electric vehicle market becomes more aggressive. Companies like Tesla, Ford, and Chinese manufacturers such as BYD offer alternatives at lower prices, which could make it harder for Rivian to maintain its market position.

The second threat comes from the federal government, with President Trump and the Republican Party signaling intentions to eliminate the tax credit for electric vehicles. Currently, electric vehicle buyers are eligible for a tax rebate of up to $7,500, making vehicles more attractive to consumers. The removal of this incentive could lead to a significant decrease in demand, especially for higher-end models like Rivian’s R1T and R1S.

If the incentives are removed, customers may prefer cheaper vehicles, particularly when companies like Tesla and BYD can offer cars at lower prices due to their size advantage. For Rivian, still in its early stages of expansion, a drop in sales could delay the company’s path to profitability and create challenges in securing future investment.

Even before decisions on tariffs and the elimination of the tax credit are made, the uncertainty surrounding government policy is putting pressure on Rivian investors. The inability to assess how the electric vehicle market in the US will look over the next two years is causing concern among institutional investors, who prefer to avoid betting on companies that could be negatively impacted by regulatory changes.

The First Profitable Quarter in Company History Doesn’t Satisfy Investors

Rivian reported its first-ever gross profit of $170 million in Q4, attributed to improvements in production costs, an increase in revenue per vehicle delivered, and a reduction in fixed costs.

“In this quarter, we achieved a positive gross profit and reduced production costs by $31,000 per vehicle delivered in Q4 2024 compared to the same period last year,” said the company’s CEO, R.J. Scaringe.

“In this quarter, we achieved a positive gross profit and reduced production costs by $31,000 per vehicle delivered in Q4 2024 compared to the same period last year,” said the company’s CEO, R.J. Scaringe. He added that this efficiency is crucial for the launch of the R2 model, the company’s budget vehicle, which is seen as a significant milestone in the company’s path to profitability.

The company also reported quarterly revenues of $1.73 billion, compared to analyst forecasts of $1.38 billion — a 32% increase from $1.31 billion in the same quarter last year.

Rivian reported an adjusted loss per share of $0.46, compared to the expected loss of $0.65. The adjusted EBITDA loss was $277 million, better than forecasts, which expected a loss of $399.8 million.

For the full year of 2024, the company posted an adjusted EBITDA loss of $2.68 billion, which was lower than the previous forecast of $2.87 billion and a significant improvement from the $3.78 billion loss in 2023. The company reported that it produced 49,476 vehicles and delivered 51,579 during 2024. In Q4 alone, Rivian produced 12,727 vehicles and delivered 14,183.

At the end of the year, the company had $5.29 billion in cash and cash equivalents, down from $7.85 billion the previous year.

Concerns About Losing Government Support in the US

Rivian’s fourth quarter was marked by significant strategic developments. In November, the company announced the expansion of its partnership with Volkswagen, with the German automaker injecting additional capital into the joint venture. As part of the partnership, Rivian will provide its electric architecture and associated software system, a critical component for the planned launch of the R2 model in the first half of 2026.

In November, the company also announced a "conditional commitment" for a $6.6 billion loan from the US Department of Energy (DOE). The loan is intended to support the construction of Rivian’s new assembly plant outside of Atlanta. However, the new Trump administration and the Department of Government Efficiency have indicated they will review the deal, which could delay or jeopardize the funding.

Additionally, the company is dealing with a recall of 17,260 vehicles in the US due to a defect in the front lights, which could reduce visibility and increase the risk of accidents, according to the National Highway Traffic Safety Administration (NHTSA) last Friday. Recalls are not uncommon in the automotive industry, especially for electric vehicle manufacturers, but each recall certainly doesn’t help the sentiment around Rivian among consumers and investors.

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