Rivian Halts Production of Amazon Delivery Vans Due to Part Shortage

According to a spokesperson for the electric vehicle manufacturer, Rivian has temporarily suspended the production of its Electric Delivery Vans (EDVs) used by Amazon.com due to a shortage of parts. This halt has led to a 4% drop in Rivian’s shares.

Rivian Ongoing Supply Chain Challenges:

The production pause is part of a broader pattern of supply chain issues that Rivian has faced. Like other electric vehicle (EV) manufacturers, Rivian has encountered significant production challenges over the past two years due to supplier shortages. The company assured us it expected to recover all missed production but did not specify the part or supplier involved.

The spokesperson confirmed that the part shortage impacts EDV production and does not affect other Rivian models, such as the R1S SUV and R1T pickup. Rivian’s vehicles are produced at its factory in Normal, Illinois, and there are plans for a second assembly plant in Georgia.

Amazon’s Perspective and Future Orders:

Amazon, Rivian’s largest investor with a 16% stake, acknowledged the “short-term production issues” but does not anticipate a significant impact.

The e-commerce giant has ordered 100,000 electric delivery vans to be deployed by 2030, with sales to Amazon representing approximately 19% of Rivian’s revenue last year.

Earlier this month, Rivian had maintained its production forecast despite a temporary factory shutdown in April for retooling and modifications. The company projected slightly lower deliveries for the current quarter.