Splitting from electric-vehicle pioneer Tesla Inc in 2016, Rivian Holdings Inc. has shrunk by more than one-third through a series of stock offerings, debt issuance and a restructuring that left it with its headquarters and research and development facilities in the Chicago suburb of Troy, Michigan.
Then, in February, Rivian took the drastic step of filing for an initial public offering. Underwriters had hoped to raise $400 million, but the IPO sold for just $116 million and ended with the company losing $83.2 million in its first six months on the market. The electric-truck manufacturer said in July that it had drawn down $150 million of the $200 million it set aside for the IPO.
That’s when things looked grim.
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The stock tumbled 40% in the first month, partly due to poor market conditions for IPOs. Rivian began preannouncing its second-quarter results ahead of that release in August, but the news wasn’t pretty. Orders fell 40% compared with the first quarter, and production remained constrained.
But the second quarter turned out to be a boon for Rivian, buoyed by the underlying strength of the North American truck market. The average price of a Commercial Truck of 2018 was up almost $400, making shipments more profitable than first quarter levels despite higher costs.
Rivian is no stranger to setbacks. Back in 2014, the company had to delay its first electric pickup truck after a third-party supplier failed to deliver on schedule. That cost it a second attempt to come up with a prototype of a pickup truck, as it needed to retool its technology and the supplier was hampered by production delays.
In 2015, Rivian had to eliminate 200 workers as the company announced its third restructuring in five years and said it would lose another $64 million.
Rivian rode high after a hiring spree in 2012 that resulted in a growing workforce of 270 full-time employees and on-the-ground engineering facilities in the company’s new headquarters. It was founded in 2007, and its first vehicle, the Brammo Urban EV, was built in 2012.
The company has since secured more than $600 million in debt and equity financing, putting the company on much firmer footing.
Rivian has been aggressive in pursuit of electric and self-driving trucking. It hopes its Aurora, Illinois-based design center will be the center of automotive innovation and a key player in electric, self-driving, electric trucks.
Rivian was founded by the wife and son of former transportation executives and industrialists Michael and Dan Rivian. The company has raised $418 million in two rounds of private funding, which closed in late 2014.
The company’s trucks have already won about 50 orders in Europe and Australia. The Madison, Wisconsin-based Rivian Trucking Company secured an exclusive pact with Walmart Inc. in 2015.