Rivian “making progress” in ramping up production and setting a market share target


35-year-old Rivian CEO RJ Scaringe displays his company’s all-electric R1T pickup truck and R1S all-electric SUV at the Los Angeles Auto Show, California, United States, November 27, 2018. REUTERS/Mike Blake

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DETROIT, Feb 24 (Reuters) – Rivian Automotive (RIVN.O) is “making progress” in ramping up production of electric vehicles at its assembly plant in Normal, Illinois, and aims to take 10% of the electric vehicle market by 2030, chief executive RJ Scaringe said Thursday.

“We are absolutely making progress,” he told a Wolfe Research conference on the drive to increase vehicle production. “The factory is starting to get off to a good start.”

Scaringe said Rivian, whose shares closed up 10.7% at $63.71, idled the plant for the first 10 days of January to make changes to production lines in a bid to increase production.

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Scaringe, responding to a question about how big Rivian could become by 2030, said the company had the brand position “to build a portfolio…to allow us to really work on building a position 10% market share in the EV space.”

He called the global shortage of semiconductor chips the “most painful” constraint in the push to increase production. The California-based startup produced 1,015 vehicles last year, falling short of its target of 1,200 due to supply chain constraints. Read more

Scaringe said Rivian replaced some chipsets in some parts with other, more readily available chipsets. He said the global shortage would be a factor for the rest of the year.

Rivian’s stock tumbled after it described in its first quarterly earnings report as a public company its struggles with manufacturing its R1T pickup truck and R1S SUV. It also has a contract to build 100,000 electric delivery vans by 2025 for Amazon.com, which has a 20% stake in Rivian. Read more

In December, Scaringe linked production challenges to global supply chain constraints, the COVID-19 pandemic, a tight labor market and near-term issues in building electric battery modules. . Read more

Scaringe said Thursday that Rivian is building a pilot line for in-house battery cell production and also plans to co-invest with a supplier on production as well. Rivian cells are currently supplied by Samsung SDI (006400.KS). He also said automakers will need to work on securing critical battery materials like lithium and nickel.

“It’s not a choice. It’s a requirement,” he said.

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Reporting by Ben Klayman in Detroit; Editing by Leslie Adler, Bernard Orr

Our standards: The Thomson Reuters Trust Principles.

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