Rivian’s (RIVN) gross margins fall in Q4 2023, EV maker cuts staff, but there’s more to it
Rivian (RIVN) released its Q4 2023 earnings Wednesday, showing gross margin improvements over last year, but the numbers are down sequentially. Rivian also announced it will reduce its workforce by 10%. With cost-cutting measures in place and new affordable products, Rivian expects to achieve modest gross profit by the end of the year.
Fourth quarter earnings preview
After delivering over 50,000 EVs, more than double last year’s delivery numbers, Rivian looks to keep the momentum rolling in 2024.
Despite the growth, Rivian’s pace slowed in Q4 as expected. Rivian’s CFO, Claire Mcdonough, said the company expected “a more significant gap between production and deliveries in Q4.”
The slowdown was due to Amazon limiting its new vehicle intake during the holiday season. Meanwhile, registration data shows Rivian was the fifth best-selling EV brand in the US last year, with 4% of the market.
After introducing new lower-priced R1S and R1T options (now starting at $71,700), analysts are worried about Rivian’s ability to generate a p.rofit
The EV maker reported a net loss of $1.3 billion in the third quarter, with around a $30,500 loss per vehicle. Although still high, that number is down from $139,277 a year ago.
Rivian Q4 2023 earnings results
Rivian generated $1.3 billion in revenue in Q4, primarily from the 13,972 vehicles delivered. For the full-year, Rivian’s revenue reached $4.4 billion, up 167% from 2022.
Rivian’s gross loss of $606 million is an improvement from last year’s $1 billion loss. However, it’s up from -$477M in Q3 and -$412M in Q2 2023. With lowered delivery numbers, higher gross losses were expected.
Gross margins were -46% in the fourth quarter, down from -36% in Q3 and -37% in Q2 2023. That equaled out to a $43,372 loss per vehicle delivered.
| Q3 ’22 | Q4 ’22 | Q1 ’23 | Q2 ’23 | Q3 ’23 | Q4 ’23 | |
| Rivian loss per vehicle | $139,277 | $124,162 | $67,329 | $32,594 | $30,500 | $43,372 |
Although $43K is still a significant amount, it’s an $81K improvement compared to the year before. Following a shutdown in the second quarter, Rivian expects to see further cost reductions.
Overall, Rivian posted a net loss of $1.58 billion in Q4, down from $1.79 billion the year before. For the full-year, Rivian’s net losses totaled $5.4 billion, down from $6.8 billion in 2022.
The EV maker also announced in its 8K Wednesday it will be reducing its salaried workforce by roughly 10%. Rivian CEO RJ Scaringe said on the company’s earnings call the move is to maximize the brand’s ability to make an impact.
Rivian ended the quarter with 9.37 billion in cash and equivalents. The company believes it has enough cash to fund operations through 2025.
A substantial opportunity ahead
Rivian says the “opportunity ahead is substantial” as it focuses on growing the brand. The EV maker will reveal its more affordable R2 electric SUV on March 7.
The company is focusing on driving greater cost efficiency with its R1 and RCV lineup. Rivian’s R1S was the top-selling EV in the US, priced over $70K. A smaller, more affordable version will help expand into new markets.
Rivian expects deliveries to be flat this year with around 57,000 due to the planned shutdown. The EV maker expects deliveries to be 10% to 15% below Q4’s numbers (11.9K to 12.5K)
With new tech and engineering upgrades, Rivian expects to achieve a “modest gross profit” in the fourth quarter of 2024.
The EV maker recently introduced leasing and new standard pack options to expand the brand to new customers. Rivian says it plans to launch new variants and trims this year to attract new markets.
Rivian’s (RIVN) stock is down over 13% in after-hours trading following the earnings release. The EV makers’ shares are down 27% since the start of 2024.
Check back for more info following Rivian’s Q4 2023 earnings call.
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Volkswagen Group Africa has officially begun production of a modern electric farm tractor at its multifunctional facility in Gashora, Rwanda in a bid to advance modern, low-emission agricultural initiatives in Africa.
Part of a larger Rwandan initiative called the GenFarm Project, the new VW tractor is part of a “holistic ecosystem” of electrified farming machinery set to be used throughout rural Africa – where liquid fossil fuels are often just as difficult to come by as electricity. The goal is to provide machinery that’s both sustainable and reliable.
“We are growing our footprint in Africa and regard Rwanda as a key growth market. This project demonstrates our commitment to sustainable practices and highlights our ability to provide mobility solutions to the rural community in addition to the urban community currently serviced by our Volkswagen Mobility Solutions Rwanda business,” explains Martina Biene, Volkswagen Group Africa Chairperson and Managing Director. “The GenFarm Project fosters technological innovation and aligns with Volkswagen Group’s strategy to generate meaningful value for both society and the environment through sustainable mobility.”
The GenFarm project will eventually provide mobility services for transportation of goods and people. In June 2023, Volkswagen Group Africa signed a Memorandum of Understanding (MoU) with the Government of Rwanda to provide land for the establishment of the GenFarm Project.
The Volkswagen tractors’ electric motor produces 20 kW (about 27 hp), making it about the same size as the Solectrac product (which hasn’t worked out well in the US, it must be said). That motor gets its electrons from a 32 kWh swappable battery. Batteries are swapped/charged at the Empowerment Hub to minimize downtime. DC fast charging isn’t available, but the relatively small, swappable batteries (hopefully) mean that’s not much of a problem.
The GenFarm project hopes the new VW electric tractor will help clean up Rwanda’s agricultural sector, which currently accounts for some 25% of the national Gross Domestic Product.
Electrek’s Take
We’ve talked a lot about the lack of new farmers in America, but the problem is global – especially as western companies, and western ideas about consumerism, continue to spread. Products like this electric tractor from VW will make farming cleaner, quieter, and (hopefully) more attractive to young workers.
SOURCE | IMAGES: VW Group Africa.
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A new, all electric Peterbilt 579EV is in-service at Honda’s Lincoln, Alabama assembly plant, where it’s busy transporting newly-built Honda cars from the plant to a nearby railhead for shipment to dealers across the country.
Part of a pilot program between Honda, Alabama Power, and Virginia Transportation Corp., the new electric semi truck will help stakeholders gather data about the practicality and performance of the battery-powered Pete and use it to generate case studies for broader electrification initiatives. Other supporters of the pilot project include the Alabama Clean Fuels Coalition and, of course, Peterbilt.
“We remain committed to delivering for our customers and the environment,” offered Leo Doire, owner and CEO of Virginia Transportation Corp. “Our new Peterbilt 579EV model will be tested to determine how well it performs against the high productivity demands of our operations. The partners we have at the table will help us maximize this opportunity and prepare to scale up if we get the results we are hoping for.”
The truck itself has been spec’ed to be perfect for the kind of short haul and drayage applications Honda has in mind. This particular Peterbilt 579EV is fitted with PACCAR’s 400 kWh battery and a 670 hp electric motor good for an impressive 2,050 lb-ft of peak torque at 0 rpm.
The truck offers 150 miles of operating range and can be charged in about 3 hours on a 120 kW charger installed specifically for that purpose. A charger, it should be noted, that was partially paid for by Alabama Power.
“Alabama Power’s ‘Make Ready’ program provides businesses with valuable rebates to help reduce the upfront costs of installing EV infrastructure,” says Alabama Power Electric Transportation Manager Hasin Gandhakwala. “We are committed to partnering with customers who are exploring state and federal grant opportunities. Alabama Power is dedicated to advancing EV technologies to better serve the needs of our customers.”
The electric semi is a continuation of a decarbonization project Honda initiated in 2011, when the company recruited Virginia Transport Corp. to help find ways to reduce emissions at its Alabama facilities. VTC’s efforts have led to changes that displaced more than 475,000 gallons of diesel in 2023 alone.
Electrek’s Take
With the big Pete’s 82,000 lb. GVWR and 150 miles of range between charging sessions, it seems like these guys will be making a lot of back-and-forth runs between the Honda plant and the CSX terminal to me. Here’s hoping they see the benefits of electrifying the rest of their vehicle transport fleets somewhat sooner than later.
SOURCE | IMAGES: Alabama Power.
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On today’s episode of Quick Charge, we’ve got big solar breaking ground all over, despite the incoming administration’s supposed lack of love for home-grown clean energy. Our guests today walk us through home solar, energy storage, and more.
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Read more: Saldivar’s Trucking: first owner-operator to deploy Volvo VNR Electric semi.
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