Toronto, Ontario — In this weekly Tuesday Ticker, Volkswagen mulls reasons for its decreased passenger car sales, while Rivian seeks loans and reduces its full-year production forecasts.
Volkswagen on a tightrope
Volkswagen’s passenger car sales are down more than one full percentage point, and EVs could have something to do with it.
In early September, Volkswagen’s CEO Arno Antlitz said Volkswagen would produce and sell 500,000 fewer units in Europe this year and next.
Antlitz said Volkswagen’s passenger car sales have dropped to 2.3 percent, compared to 3.8 percent in 2023.
EVs could be part of the problem, according to an analysis by AutoForecast Solutions’ October 2024 newsletter. Sales of EVs in the European Union have dropped, largely due to eliminated or reduced subsidies for EV buyers.
During a Sept. 2 meeting at Volkswagen’s Wolfsburg site, Antlitz said the OEM has “one, maybe two years to turn things around.” The automaker will need more cost savings than what is outlined in its current cost-savings plan.
Volkswagen is also negotiating with its largest union, IG Metall. If both parties fail to reach an agreement by Dec. 1, 2024, the union could strike.
Rivian in the rough
Rivian put plans for a second Georgia-based assembly plant in March as a cost-cutting measure, though the OEM is pursuing a federal loan to finance the project, according to a new filing on the U.S. Department of Energy’s website.
The plant originally planned to manufacture the next-gen R2 series of Rivian vehicles. Sources suggest the plant costs up to US$5 billion to build and outfit.
The new filing suggests plant production could begin in Q3 2027 if the loan application is approved. Rivian anticipates the plant to be fully up and running by 2028, generating about 7,500 jobs and 400,000 vehicles per year by 2030.
Proposed loan values or terms and conditions were not shared.
Rivian also cut its full-year production forecast last Friday. The automaker also missed its Q3 2024 delivery expectations due to a parts shortage and slowing growth in EV demand. The automaker’s shares fell more than seven percent after the news broke, dropping as low as US$9.97 per share.
Rivian said it’s running short on a particular part used in its R1 SUV and R1T pickup trucks, specifying that the shortage has become more acute in recent weeks. The OEM did not identify the exact part or its supplier.
Rivian delivered 10,018 vehicles in Q3, compared to estimates of 12,078, according to analysts from Visible Alpha.
As of Tuesday at 11:30 a.m. ET, shares of Rivian traded at US$10.28 per share, down 51.26 percent year-to-date.
