EV maker Rivian is losing money like it’s going out of style, there’s relatively little inventory left on dealer lots, and Mazda. All that and more on this glorious Friday edition of for August 12, 2022.
Electric truck maker Rivian reported its net loss in the second quarter tripled to $1.7 billion, something . It’s pressured the start-up to save some cash and move quickly to fill customer orders.
The California-based company said revenue for the quarter was about $364 million as it increased production and deliveries of its vehicles.
The results, while bleak, roughly met analysts’ expectations. The company reported an adjusted net loss of $1.62 per share.From the :
The auto maker affirmed its 2022 production guidance of building 25,000 vehicles by the year’s end, but said its operating loss is expected to grow to $5.45 billion, from its previous projection of $4.75 billion for the full year.
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Rivian is seeking to rein in those costs by increasingly shipping vehicles by rail instead of by truck, which is cheaper but could result in a longer delivery time to customers, Ms. McDonough said.
In order for the company to hit its production target of 150,000 vehicles per year at its Normal, Illinois plant, it would have to be run on both day and night shifts.
As it focused on ramping up production, Rivian also said it had trimmed capital expenditures to preserve cash and expected to spend $2 billion rather than its original projection of $2.6 billion.
At the end of June, Rivian had about $15.46 billion in cash and cash equivalents, about $1.5 billion less than at the close of the first quarter.
The company produced just 4,401 vehicles in the second quarter. It aims to hit 25,000 by the end of the year.
Vehicle inventory levels are pretty much stagnated in the U.S. at just 1.02 million vehicles, according to Cox Automotive and the Automotive News Research & Data Center.
It’s primarily due to the continued supply chain issues and the microchip shortage. The issues are blocking automakers from boosting production despite a slowdown in sales. From :
Cox estimates in its most recent survey that inventory declined in July to 1.02 million vehicles, down by about 98,000 from where it stood a month earlier and marking the seventh consecutive month that inventory has stayed between 1 million and 1.1 million. Cox said the total represented a 37-day supply, based on its practice of using the selling rate from the most recent 30-day period. That compares with a 35-day supply a month earlier and a 31-day supply at the same point last year, when Cox estimated inventory at 1.2 million.
Among the seven automakers that continue to report sales and inventory data to the Automotive News Research & Data Center, Subaru still had the tightest supply, at three days, with other Asian brands also running lean because of their long supply lines.
For example, the Toyota brand began August with 86,696 vehicles, representing a 15-day supply. Of that, just 9,530 were in dealers’ hands, with the remainder still in the delivery pipeline. Lexus had a 20-day supply, at 18,094 vehicles, but only 4,728 were at dealerships.
Among reporting brands, Ford apparently has the strongest inventory levels at 40 days (unless you want a Bronco). Cox says supply is tightest for small cars, minivans and EVs.
Mazda has been a bit hurt by various COVID-19 lockdowns in China, since Mazda sources a lot of its parts from China. In this respect, it is not much different from a lot of other automakers, though Mazda is trying to learn from its recent past, :
Mazda Motor Corp. said on Friday it would ask its parts suppliers to increase stockpiles in Japan and produce components outside China after COVID-19 lockdowns in Shanghai destabilized supply lines and hampered production.
The request from the Hiroshima-based automaker underscores the vulnerability of sprawling supply chains that have been tested by the pandemic and geopolitical tensions, casting uncertainty over businesses.
[...]
Mazda said it brought chips and crucial auto parts to China to be assembled, but was unable to receive those components from Shanghai during the city’s lockdown.
Even if Mazda’s direct suppliers were Japanese and European companies, they still had parts coming through China, said Takeshi Mukai, the automaker’s senior managing executive officer.
“In our case, we were the first to be affected by the lockdown, as we had been promoting the procurement of parts via China for a while,” Mukai said. “Given the current (zero-COVID) policy, the key point is to keep (parts) in our hands.”
Japanese truck maker Hino and its parent company, Toyota, are being accused of historical misconduct in a class action lawsuit that’s being brought in U.S.
The case, which is being filed in the Southern District of Florida, is being done on behalf of those who bought or leased 2004-2021 model year Hino truck in the U.S., the company said in a statement. From :
An investigation report this month by a company-commissioned panel said Hino, Toyota’s major affiliate, had falsified emissions data on some engines going back to at least 2003, or more than a decade earlier than previously indicated.
Hino blamed an inward-looking corporate culture and a management failure to engage sufficiently with workers that led to an environment that put greater priority on achieving schedules and numerical targets than following processes.
The panel said the inquiry looked into mid-size and large engines for the U.S. domestic market, but it didn’t rule out chances of similar issues overseas.
California’s High-Speed Rail Authority reported it won $25 million in new federal grant money to advance its project beyond the 119 miles under construction. The agency is pursing an additional $1.3 billion in award money.
The U.S. Transportation Department grant is going to provide more than half of the estimated $41 million for a design contract to connect the Californian cities of Madera and Merced. Last fall, President Biden’s administration awarded it $24 million for “crucial safety, efficiency and construction projects” around Wasco, California. From :
The new grant helps to fund “design civil infrastructure, track and systems and station platforms,” USDOT said. The project “is expected to reduce vehicle miles traveled by over 200 million miles per year, and the high-speed rail system will run on entirely renewable energy,” it added.
The rail will ultimately travel from San Francisco to the Los Angeles basin at over 200 miles per hour (322 kph) in under three hours. The fastest U.S. passenger train, the Acela on the northeast corridor, travels up to 150 miles per hour but aging infrastructure prevents that top speed along much of the route.
California is seeking $1.3 billion in federal grant funding to double-track the 119 miles under construction and purchase new train sets.
Congress approved $66 billion for rail as part of the 2021 $1 trillion infrastructure bill, with Amtrak receiving $22 billion and $36 billion allocated for competitive grants.
In June of last year, the Biden administration restored a $929 million grant for the project. That came after a 2019 decision by then-President Donald Trump to pull funding for the project... calling it a “disaster.” This is all, still, small potatoes compared to .
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You work hard, now it’s time to play hard. Have a couple brewskis and sit out in a lawn chair. It’s gonna be a beautiful weekend.
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