What Happened?
Shares of electric vehicle manufacturer Rivian (NASDAQ: RIVN) fell 4.8% in the morning session after the company recalled over 24,000 of its 2025 model year R1T and R1S vehicles due to a software issue.
The safety concern involved the hands-free highway assist system, which may not correctly identify a lead vehicle, increasing the risk of a crash. Compounding the negative sentiment, Rivian highlighted significant short-term headwinds at a Morgan Stanley conference. The company noted that the expiration of the $7,500 consumer tax credit and the removal of revenue from greenhouse gas credits impacted its finances.
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What Is The Market Telling Us
Rivian’s shares are extremely volatile and have had 32 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was about 23 hours ago when the stock gained 3.1% on the news that the company and Volkswagen Group announced a joint semiconductor procurement strategy to streamline their supply chain and cut costs.
The new initiative introduces a procurement model spanning more than 50 semiconductor categories, aiming to reduce costs and strengthen supply chain resilience for future vehicles. This news builds on positive commentary from the previous day's Goldman Sachs conference, where CEO RJ Scaringe highlighted ambitious plans for the company. Scaringe pointed to the upcoming, lower-priced R2 vehicle as a pivotal point for growth and expanding market reach. He also reinforced the company's focus on achieving adjusted EBITDA break-even by 2027 and the strategic importance of its broader partnership with Volkswagen.
Rivian is down 0.6% since the beginning of the year, and at $13.18 per share, it is trading 22.1% below its 52-week high of $16.92 from May 2025. Investors who bought $1,000 worth of Rivian’s shares at the IPO in November 2021 would now be looking at an investment worth $130.80.
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