Wednesday, May 29, 2024
NewsRivian Could Have to Push Back the Deliveries of its Commercial Vans

Rivian Could Have to Push Back the Deliveries of its Commercial Vans

Rivian could have to pause the production of its commercial van due to a lack of seats.

Rivian is reportedly in the grip of a dispute with one of its suppliers, Commercial Vehicle Group, alleging that the latter has not respected the clauses of a contract between the two parties. This disagreement could also delay the delivery of vehicles. The lawsuit filed in March 2022 concerned the significant increase in rates surrounding the seats the company was to produce and supply to Rivian for the completion of its commercial vans for web giant Amazon.

Now, according to Automotive News, a Rivian representative has reportedly confirmed, contrary to allegations in recent weeks, that the automaker continued to receive the famous seats assembled by Commercial Vehicle Group during this period and that the two parties were currently discussing a way to resolve this component routing dispute.

The rate increase was almost twice the original agreed-upon price, according to the lawsuit. Rivian’s shares fell 6.9 percent on Monday, and are down 76 percent year-to-date. The other company involved also saw its stock value drop 2.4 percent.

Rivian also said in the lawsuit that its inventories of pre-assembled seats were very low – with just over 100 sets of seats – and that a production plant closure was imminent. Recall that Rivian is scheduled to deliver the first 10,000 of its van to Amazon before the end of the year, the web giant which has an order for 100,000 all-electric vans from the small Irvine, California-based manufacturer.

Amazon Rivian Van | Photo: Amazon

Also worth mentioning is the fact that Ford Motor Co. one of the largest shareholders in Rivian, sold seven million shares of Rivian stock on Monday. The move follows the sale of eight million shares last week, both of which would have reduced Ford’s stake in the company from 12 percent to 10 percent since this second share sale.

The new player in the electric car arena has been struggling with several supply disruptions in recent months, with Rivian producing only 5,000 vehicles so far this year. Nevertheless, Rivian sought to reassure its investors last week by reiterating its intention to produce more than 25,000 vehicles by 2022.


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