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Published: 2022-08-11 18:28:23 Updated: 2022-08-11 18:28:23
Posted August 11, 2022 6:28 p.m. EDT
By Matt McFarland, CNN Business
CNN — Rivian said Thursday that it lost $1.7 billion in the second quarter of 2022 as it works to ramp up its vehicle production amid the on-going supply chain crunch. The automaker's losses more than doubled from the same period last year, when it lost $580 million.
Rivian CEO RJ Scaringe said on a call with investors that during "a lot" of the second quarter they were not able to fully utilize their production line.
"We weren't even able to run a full single shift because of component supply," Scaringe said.
Rivian expects supply chain shortages to continue to limit its growth, but it's confident enough in an improved outlook that it said it expects to add a second shift at its Normal, Illinois, manufacturing plant later this year. Scaringe expressed confidence the production rate will continue to grow, as increasing the number of vehicles making it out of the factory doors is critical to achieving profitability.
Rivian, which has heavy backing from Amazon, had 98,000 preorders in the US and Canada at the end of June, and it said its rate of preorders has increased this year. The majority of new buyers for its pick-up truck, the R1T, have never owned a pick-up truck before, the automaker said.
The hefty losses are in line with Rivian's expectations for the year. It said the losses stemmed from its investment in people, technology and vehicle programs.
Rivian had laid off 6% of its workforce in July, citing inflation and increased interest rates.
Rivian produced 4,401 vehicles in the second quarter and delivered 4,467 vehicles, and its production increased 72% from the first quarter of the year, when it produced 2,553 vehicles. The automaker plans to produce 25,000 units this year. Rivian's stock fell 2% in after-hours trading.
The automaker still has more than $15 billion in cash to finance its operations, which it says will be enough to finance its upcoming Georgia manufacturing plant and a new vehicle platform, dubbed R2.
The company also said that its delivery vehicles have carried more than 430,000 packages for Amazon since early 2021.
Rivian's chief financial officer, Claire McDonough, said that the automaker will introduce a lithium iron phosphate battery pack in its delivery vehicles. The battery chemistry has become increasingly popular with automakers as they face shortages of battery metals.
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