Join our daily newsletter At The Bell to receive exclusive market insights
- Shares in Rivian Automotive surged up to 53 per cent in its NASDAQ debut on Wednesday, concluding this year’s biggest IPO
- It makes Rivian the second most valuable US vehicle manufacturer after Tesla, which tipped over a US$1 trillion (A$1.36 trillion) valuation last month
- The company plans to build at least one million cars per year by the end of the decade, having launched its R1T vehicle in September
- However, Rivian has had trouble ramping up production in Illinois as supply chain concerns hit automakers around the world
- Shares in Rivian closed at US$100.73 (A$137.41) on Wednesday, marking a nearly 30 per cent jump from its offering price of US$78 (A$106.40) per share
Shares in Rivian Automotive surged up to 53 per cent in its NASDAQ debut on Wednesday, giving the Amazon-backed electric car maker a market capitalisation of more than US$100 billion (A$136 billion) and concluding the world’s biggest IPO so far this year.
It also makes Rivian the second most valuable US vehicle manufacturer after Tesla, which tipped over a US$1 trillion (A$1.36 trillion) valuation last month.
Despite only recently starting to sell cars and having little revenue to report, the company ranks ahead of General Motors at US$86.05 billion (A$117 million), Ford at US$77.37 billion (A$105 billion) and Lucid Group at US$65.96 billion (A$90 billion).
Rivian has also had trouble ramping up production in Illinois as supply chain concerns hit automakers around the world. In July, the California-based company said COVID-19 and its impact on suppliers had delayed the launch of vehicles out of the state.
The IPO enabled Rivian to raise around US$12 billion (A$16.37 billion) to fund various growth initiatives. That figure could increase to US$13.7 billion (A$18.69 billion) if the full over-allotment of shares is exercised, making it the biggest US IPO since Alibaba Group went public in September 2014.
Some of Wall Street’s biggest institutional investors, including BlackRock and T Rowe Price, are betting on Rivian to be the next big player in a sector that has so far been dominated by Tesla, and amid growing pressure on car makers in China and Europe to cut vehicle emissions.
Amazon, however, is the company’s largest shareholder with a 20 per cent stake. Ford also owns a 12 per cent stake, valued at roughly US$10 billion (A$13.64 billion).
Rivian has invested heavily in boosting production. In September, it launched the all-electric R1T vehicle, which will be followed by an SUV and delivery van.
The company now plans to build at least one million vehicles a year by the end of the decade, according to chief executive Robert “RJ” Scaringe. In addition to the plant in Illinois, Rivian said it has plans to set up a second US factory along with manufacturing operations in China and Europe.
“Rivian is in the early stages of delivering its first vehicles to customers, which tells investors the company and vehicles are ‘real’ and not merely pictures in a slide deck,” Michael Shlisky, an analyst at D.A. Davidson & Co told Reuters. “This has been an issue with other EV companies in recent months.”
Shares in Rivian closed at US$100.73 (A$137.41) on Wednesday, marking a nearly 30 per cent jump from its offering price of US$78 (A$106.40) per share.
