Rivian told shareholders the company built 4,401 vehicles in the second quarter, nearly double its Q1 output and is on track to meet its goal of producing 25,000 electric pickups and SUVs in 2022.
The total beat the projections of many analysts, including RBC Capital Markets, which predicted Rivian would produce just 3,400 vehicles. The company needs to build about 9,000 of its R1T pickups and R1S sport-utility vehicles in each of the next two quarters to hit its production target.
Investors responded to the news, sending the company’s stock price up more than 11% to nearly $30 a share in mid afternoon trading. The bump must be nice to see for company officials, which has seen the stock price lose more than 70% of its value since going public last fall.
In addition to building more than 4.4K vehicles, it delivered 4,467, which is nearly four times what it did during the first three months of this year. The numbers are less than the original prediction for 2022, which the company cut in half in March after struggling with parts shortages, especially semiconductors, and other issues.
Second half rally
“These figures remain in line with the company’s expectations, and it believes it is on track to deliver on the 25,000 annual production guidance previously provided,” the company said in a statement — the only thing it said in the statement.
Officials said they plan to run two shifts five days a week during the second half of the year to meet its 25K target, Bloomberg News reported. Right now, the company runs an intermittent schedule and just one shift.
The company’s plant, a former Mitsubishi site in Normal, Illinois, can build 150,000 vehicles annually. However, officials said the plans call for expanding that capacity to 200,000 units by 2023, although CEO R.J. Scaringe said in March the company was targeting production of 55,000 vehicles.
Additionally, it plans to add a second facility north of Atlanta, Georgia, in 2025 to help it meet what it projects will be strong demand for its current and future products.
The second plant will help ease the burden the company faces building not only its consumer products, but also its delivery vans developed with online retailer Amazon, which has ordered 100,000 of the vehicles. It also holds a significant stake in Rivian.
Finding the right mix
The company’s been working to overcome issues to increase its production numbers and meet its goals. In late May, it shook up its management ranks, with chief manufacturing engineer Charly Mwangi leaving for “personal reasons.”
In fact, Scaringe announced both a management shuffle, which included the departure of Mwangi, as well as a reorganization of the company’s manufacturing operations. It split the retail side of the business from Rivian’s commercial operations — the 100,000 delivery vans for Amazon Prime.
“This is an important time for our growing business, all of which is happening in an extremely challenging environment,” Scaringe said in a statement. “We are well-positioned for long-term success, but we must continuously evaluate how we operate.”