(Bloomberg) -- Rivian Automotive Inc. said it’s on track to achieve a positive gross profit in the final three months of the year, counting on a surge of regulatory credit sales after production disruptions added to losses.
The electric-vehicle maker expects about $300 million worth of credit sales this year, Chief Financial Officer Claire McDonough said on a conference call with analysts. That means the company will need to bring in $275 million of those transactions during in the final three months of the year, a huge jump from the $25 million it has sold so far in 2024 to rivals who need assistance complying with stricter pollution rules.
Rivian reaffirmed the closely watched target as it reported third-quarter results impacted by a part shortage that forced it to halt production at its sole EV assembly plant. The company’s shares rose as much as 4.5% in extended New York trading.
The outlook underscores how Rivian is managing through a series of supply chain and production disruptions that have weighed on its results. The company reported a third-quarter adjusted loss of 99 cents a share, worse than the 92-cent average deficit estimated by analysts.
The quarter was impacted by a part shortage that forced the company to halt production of its R1 battery-electric SUV and pickup models as well as the delivery van it makes for Amazon.com Inc.
Although it maintained the fourth-quarter profit target, Rivian said the interruption would weigh on its profitability this year. The company now expects as much as negative $2.88 billion in adjusted earnings before interest, taxes, depreciation and amortization in 2024, slightly worse than the negative $2.8 billion expected by analysts.
A miscommunication between Rivian and the supplier of the component earlier was responsible for the shortage, Bloomberg News reported last month.
The snag pushed Rivian in October to cut its full-year production target to no more than 49,000 EVs this year, down from an earlier projection of 57,000, in line with last year’s output. The company on Thursday reaffirmed that forecast and its target of delivering as many as 52,000 vehicles this year.
Rivian saw losses widen to more than $39,000 per vehicle delivered in the most recent period, compared to $32,705 in the second quarter.
To meet its fourth-quarter profit goal, Rivian is counting on a jump in revenue from regulatory credits sold to other automakers to boost its bottom line. The company saw just $8 million worth of those transactions in the most recent period, down from $17 million in the second quarter.
Rivian has been struggling with production challenges all year amid a broader slowdown in demand for EVs. The manufacturer is working to cut costs in ahead of the launch of the R2, a smaller, more-affordable electric SUV that’s expected to start production in the first half of 2026.
Rivian has been struggling with production challenges all year amid a broader slowdown in demand for EVs. The manufacturer is working to cut costs in ahead of the launch of the R2, a smaller, more-affordable electric SUV that’s expected to start production in the first half of 2026.
(Updates with shares, CFO comment from analyst call from second paragraph.)
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