Shares of Rivian Automotive Inc fell 7% on Monday after the electric-vehicle maker recalled nearly all its vehicles, exacerbating investor concerns that the company may not be able to meet its annual production target.
The Amazon.com Inc-backed firm on Friday recalled about 13,000 vehicles due to a possible loose fastener that could cause a driver to lose steering control.
Rivian has so far delivered 13,198 vehicles since it started selling in the third quarter of last year.
“We have greater concerns on 2023 production expectations,” RBC Capital Markets said in a note on Monday. The addition of battery packs and motors as well as downtime required at the plant to ramp up capacity could derail Rivian’s pace of production, it said.
Rivian’s shares have fallen 67.3% this year due to a selloff in equities driven by an uncertain macroeconomic environment and a production forecast cut.
The company in March cut its annual production forecast in half to 25,000 due to sticky supply-chain issues.
Wall Street expects Rivian to make 23,590 vehicles this year, according to Visible Alpha.
A local court in Georgia, where Rivian is building its $5-billion manufacturing plant, last week rejected a joint proposal by the state’s Department of Economic Development and the company to secure local incentives for its project in the state.
The local development authority had said in May the company would gain incentives of $1.5 billion from the state.
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Japan’s Toyota suffered a seven percent drop in sales in the latest three months, to more than 526,000 units, while FCA part of the Stellantis group which includes the Fiat and Chrysler brands — saw its sales drop by six percent compared to the same period of 2021.