Rivian to be impacted by "tepid demand" for electric vehicles - UBS

Investing.com -- Flagging demand for electric vehicles makes Rivian (NASDAQ: RIVN)'s path towards profitability and cash flow "onerous," analysts at UBS have said in a note downgrading their rating of the firm to "Sell" from "Buy."

The analysts added that the call for for battery-powered cars, particular in the U.S., has been "more tepid," potentially threatening the financial performance of Rivian's electric trucks.

UBS' comments come after Rivian unveiled annual production guidance earlier this week that fell short of Wall Street estimates.
For 2024, the company said it expects to produce 57,000 units, missing Wall Street estimates of 66,000. A total of 57,232 vehicles were manufactured in 2023, of which 50,122 were delivered.

Rivian said it is also planning to reduce its salaried workforce by 10% in response to a "challenging macroeconomic environment."

Speaking with investors, Chief Executive RJ Scaringe warned that the business has been impacted by "historically high" interest rates, adding its bank of orders has "notably reduced" over time.

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