Rivian Automotive Inc. stock dropped about 9% on Monday after the company that makes electric cars recalled almost all of them. This made investors even more worried that the company might not be able to meet its 2023 production goal.
Amazon.com, Inc. backed startup called back about 13,000 cars on Friday because a loose fastener could cause the driver to lose control of the steering.
The problem is said to be a connection between the front upper control arm and the steering knuckle that isn’t tight enough.
Rivian said that its engineering staff looked at a vehicle with a problem on August 13. By the end of September, they had received six more reports of problems with the fastener, including two where the steering knuckle “had become loose or separated.”
The automaker said, “There is a safety-related defect in this matter.” They also said that the problem could make it hard for a driver to control the steering, but the NHTSA filings don’t say that it has caused any accidents or injuries.
The production forecast for 2022 cut by half
Rivian started selling its electric vehicles (EVs) in the third quarter of 2017 and has so far provided 13,198 of them.
Wedbush Securities said in a note that the large recall could hurt the brand and make it harder to trust future production, but it doesn’t think the recall will change Rivian’s production or delivery goals for the year.
In early trading, shares of the company fell to $30.79, which was the lowest price in more than a month. This year, they have dropped by 67.3% because of a selloff in stocks, which was caused by an uncertain macroeconomic environment and a cut to the production forecast.
Due to problems with the supply chain, the company cut its production forecast for 2022 by half, to 25,000. Visible Alpha says that Wall Street thinks Rivian will make 23,590 vehicles this year.
