Toronto, Ontario — This week, Ford ditches more than 15 million of its shares in Rivian, while a company known for car ‘vending machines’ finds itself in hard times.
Rough week for Rivian
Ford has offloaded more than US$400 million in Rivian shares this past week.
The automaker sold eight million shares of Rivian on May 9, then unloaded a further seven million shares last Friday.
Ford sold the eight million shares at US26.80 per share, totalling US$214 million, when the seven million shares sold Friday were offloaded at an average price of US$26.88 per share, totalling US$188.42 million.
Rivian first went public last November with shares priced at US$78 per share. Despite a sharp increase to more than US$170 per share, the stock has fallen drastically in 2022, thanks to supply chain issues and lowered production targets.
Analysts had expected Rivian to produce around 40,000 vehicles this year, but Rivian said in March it now plans for 25,000 units in 2022.
The automaker produced 2,553 vehicles in the first quarter of 2022, according to Rivian’s Q1 2022 financial results.
As of Monday at 3:30 p.m. ET, shares of Rivian traded at US$24.92.
Viva la vending machine?
Online used car retailer Carvana—a company known for its multi-storey car ‘vending machines’—has seen its shares drop nearly 90 percent since November 2021.
Once priced at more than US$300 per share, the company seeking to transform the car buying process traded at US$38.32 per share as of Monday afternoon.
The company grew exponentially during the pandemic, as shoppers sought to purchase vehicles online rather than visit a dealership. Carvana has been publicly traded since 2017—but analysts are concerned about the company’s liquidity, increasing debt and predictions of slowing growth. This year is expected to be Carvana’s slowest-growing year as a publicly-traded entity.
Company slowdowns are largely due to high vehicle prices, rising interest rates and recessionary fears, among other factors, said analysts.
Carvana stock is rated “hold” with a price target of $89.30 a share, according to analyst estimates compiled by FactSet.
