Rivian (RIVN) has reportedly agreed to a “secret” cope with the UAW as it really works towards its subsequent progress part. The brand new settlement is contingent on the EV maker reaching profitability. Right here’s what that you must know.
What the personal UAW deal means for Rivian
Beneath the confidential deal, Rivian would go for a impartial stance on unionizing efforts at its Regular, Illinois, manufacturing plant.
In response to sources near the matter (through Bloomberg), the deal relies on Rivian hitting particular targets, together with reaching profitability. The personal settlement may pave the best way for the UAW to unionize employees in Regular.
Rivian has but to put up a quarterly revenue on an adjusted foundation. The EV maker posted a web lack of $1.1 billion within the third quarter, down from the $1.34 billion loss in Q3 2023. CFO Claire McDonough reiterated that Rivian remains to be on monitor to achieve a optimistic gross revenue within the fourth quarter.
CEO RJ Scaringe mentioned the corporate is seeing “significant progress” on lowering prices after shutting down its Regular plant in April for upgrades.
| Q3 ’22 | This autumn ’22 | Q1 ’23 | Q2 ’23 | Q3 ’23 | This autumn ’23 | Q1 ’24 | Q2 ’24 | Q3 ’24 | |
| Rivian loss per automobile | $139,277 | $124,162 | $67,329 | $32,594 | $30,500 | $43,372 | $38,784 | $32,705 | $39,130 |
The key UAW deal additionally reportedly helped Rivian safe its current $6.6 billion conditional mortgage from the US Division of Power. The mortgage will assist fund Rivian’s new manufacturing plant in Georgia, the place it should construct its extra inexpensive R2. Nonetheless, the mortgage can be based mostly on the EV maker reaching sure monetary metrics and different necessities.
Ramping EV manufacturing
Rivian builds its present R1S SUV and R1T electrical pickup in Regular with plans to start R2 manufacturing in 2026. Though the smaller, extra inexpensive EV will initially be inbuilt IL, Rivian plans to considerably develop output with the brand new plant in GA.
The EV maker expects to construct between 47,000 and 49,000 automobiles this 12 months. After upgrading the ability earlier this 12 months, Rivian mentioned it will possibly construct as much as 150,000 EVs a 12 months in Regular.
When R2 launches in 2026, Rivian expects annual manufacturing capability to be round 215,000, 155,000 of which would be the R2. After its GA plant opens, Rivian expects so as to add one other 400,000 to that quantity.
In response to Bloomberg, Rivian has been “a longtime goal for the UAW.” If the deal goes via, employees in Regular would have extra say over issues reminiscent of pay and dealing circumstances.
The UAW targetting Rivian is a part of its broader plans to unionize the EV trade. As extra particulars unfold, the deal may mark a big step in its efforts, doubtlessly setting Rivian other than rivals like Tesla.
Final month, Rivian and Volkswagen formally launched their new three way partnership, “Rivian and VW Group Expertise, LLC.” The partnership will use Rivian’s experience to develop a next-gen EV structure and “best-in-class software program” for each corporations’ future EV fashions.
Scaringe mentioned the collaboration is a “landmark growth for the trade.” Volkswagen plans to take a position as much as $5.8 billion in Rivian and the brand new JV, which Scaringe calls “a significant monetary alternative.”
Rivian’s inventory is up round 33% since reporting Q3 earnings on November 7, however share costs are nonetheless down 37% in 2024.
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