Shares of Rivian Automotive (RIVN 1.96%) slumped today and were trading nearly 7% lower as of 1:30 p.m. ET Tuesday. With Donald Trump taking the oath of office on Monday and revoking as many as 78 executive orders signed by his predecessor Joe Biden -- including one on electric vehicles (EV) -- investors in Rivian are feeling jittery.
President Donald Trump's anti-EV moves
Among several other orders signed by Biden, President Trump revoked a 2021 executive order on Monday that set a goal of 50% of all new vehicles sold in the U.S. to be electric by 2030. Trump also halted the distribution of the remaining $5 billion in funds for EV charging infrastructure, and may remove the $7,500 federal tax credit available on some EV purchases.
In short, while Biden's EV goals were part of his big plans to fight climate change and provided a huge impetus to the EV industry, Trump's moves could slam the brakes on the industry. That's spooking investors in Rivian, who were finally turning hopeful about the company after a long wait.
NASDAQ: RIVN
Key Data Points
Why Rivian stock could come under pressure
Rivian's production woes are far from over. Earlier this month, Rivian said it produced only 49,476 vehicles in 2024, down nearly 14% from 2023. Its deliveries of 51,579 units last year were up only about 3% from 2023.
However, Rivian also said that a component shortage isn't a constraint anymore, which means its production could rise in 2025. It also expects to turn a positive gross profit in the fourth quarter (it will report its Q4 numbers on Feb. 20).
Meanwhile, Rivian received a loan commitment of up to $6.6 billion from the Department of Energy earlier this month to build a factory in Georgia. It also recently formed a joint venture with its long-standing partner and auto giant Volkswagen, where the latter will invest up to $5.8 billion in the EV maker.
Investors in Rivian, therefore, had valid reasons to turn optimistic about the company's future. Trump's anti-EV stand, however, could cut short their expectations and hopes.
