RIVIAN Automotive recorded its first-ever quarterly gross profit to close out 2024, achieving a long-held goal even as it warned that policy shifts in Washington may weigh on its electric vehicle (EV) sales this year.
The EV maker posted a fourth-quarter gross profit of US$170 million and expects a “modest” positive result for the figure this year, the company said. The fourth quarter result easily topped the US$32 million expected by Wall Street.
Rivian’s shares rose more than 3 per cent in after-hours trading on Thursday (Feb 20), signalling that investors saw signs of progress after the company battled supply chain problems and high costs that hampered its results last year.
Still, the company said it expects to sell between 46,000 and 51,000 EVs this year, below the roughly 54,800 average of analyst estimates compiled by Bloomberg. The guidance reflects Rivian’s view of the impact that could result from changes to tariffs, EV tax credit and regulatory credit policies that could weigh on sales, Rivian chief executive officer RJ Scaringe said.
“We, as much as everyone else, are very much closely watching what’s going to happen with tariffs around our supply chain, which will drive cost up and could ultimately lead to potential price changes,” he said.
The forecast highlights the pressure on EV makers and other car companies from potentially huge policy changes by US President Donald Trump. He has vowed to gut his predecessor’s efforts to bolster consumer adoption and production of EVs, and has threatened steep tariffs that risk hitting all automakers with higher costs.
Changes to fuel economy and pollution regulations could also affect the marketplace for regulatory credits, a lucrative revenue stream for pure-play EV makers such as Rivian and Tesla.
Revenue from those credits jumped by US$260 million in the fourth quarter.
Scaringe told Bloomberg that credit sales that come from programmes including California rules requiring carmakers to sell more zero-emission vehicles each year are “quite valuable” to the company. Scaringe said he expects little change to that regulatory system because it does not impose a cost on the federal government. BLOOMBERG
