By Dhirendra Tripathi
Investing.com – Rivian stock (NASDAQ:RIVN) fell nearly 5% on Wednesday on reports of the company delaying deliveries of its electric pickup truck and sports utility vehicle with big battery packs to 2023.
The bigger battery pack, called the Max pack, is expected to have mileage of 400 miles on a single charge. Only 20% of the preorders were for the Max pack, according to Reuters.
According to the report, in a mail Tuesday to customers, Chief Executive RJ Scaringe said majority of Rivian's roughly 71,000 preorders for its R1T pickup truck and R1S SUV in the U.S. and Canada were for a version of the vehicles with a small battery pack option, which provides 314 miles on one charge.
"In order to serve the largest number of preorder holders, we will be prioritizing building the Adventure Package with large pack battery during the next year," Scaringe said in the mail that was posted by a Rivian customer on Reddit, Reuters reported.
Earlier this month, higher R&D spending and losses on convertible debt pushed the company’s third-quarter loss more than four times higher, to $1.2 billion. The company said it expected production to fall a few hundred vehicles short of its 2021 target of 1,200 units.
Compounding the disappointment were the pre-orders for the two vehicles that at 71,000 units, according to Morgan Stanley analyst Adam Jonas quoted by Reuters, were at the low end of expectations.
The lack of chips has strangled production of vehicles at automakers, particularly tech-heavy vehicles built by startups such as Rivian. The company made its public debut last month and commands a market value of around $93 billion even though it has yet to book any meaningful revenue.