Rivian is quickly figuring out how expensive it will be to get into the automotive industry, reporting a net loss of $ 1.59 billion in the first quarter.
The EV startups quarterly losses jumped significantly from a loss of $ 414 million reported in the first quarter of last year. They were primarily based on higher operating costs, including the fact that Rivian spent $ 547 million on research and development during the quarter compared to $ 121 million in the first quarter of 2021.
As confirmed earlier in the week, Rivian produced 2,553 cars in the first quarter and delivered 1,227 of them, helping it generate revenue of $ 95 million. The company notes that as it continues to “produce vehicles in small volumes on production lines designed for higher volumes,” it will continue to experience negative gross profits due to significant labor costs and overhead costs. Rivian expects costs to improve on a car-based basis as production increases and grows faster than labor and overhead costs increase.
“The supply chain continues to be a bottleneck in our production,” Rivian confirmed in a letter to shareholders. “This problem continued through a small handful of technical components such as semiconductors as well as several non-semiconductor components. From March 31, 2022, we were forced to suspend production for a longer period than expected, with the result that about a quarter of the planned production time was lost due to supplier restrictions. ”
While big losses may not look very pretty on paper, Rivian ended the first quarter of 2022 with $ 16.97 billion in cash, cash equivalents and limited cash, excluding additional credit lines. That’s enough money to lead the company to begin production of its more affordable, new-generation EV, which will be built at a future plant in Georgia.
Rivian expects to build 25,000 cars by the end of this year.