Normally, it would be safe to call a factory fire—even if no one is hurt—a tragedy. But for Rivian (RIVN) shareholders, it wasn’t that big of a deal, as shares were up over 2.5% despite the losses incurred.
The fire occurred at Rivian’s Normal, Illinois factory, in a north-side parking lot late Saturday. While no injuries were reported, multiple vehicles were said to be damaged. However, Rivian would not confirm the exact numbers it lost and noted that the fire was currently under investigation. Luckily, the assembly plant was not impacted by the fire, so business will likely be able to carry on as normal.
In fact, reports noted that Rivian is planning to expand the Normal plant to focus on the R2 SUV, which is smaller and less expensive than the R1S. Reports suggest that the R2 is considered “critical” to Rivian’s overall success in the field.
Already Struggling
Despite the clear optimism from shareholders, the news might actually be worse for Rivian than it seems. Just days ago, Rivian announced that it was temporarily halting production on a line of electric delivery vans for Amazon (AMZN) due to a shortage of parts. This parts shortage has apparently been common for multiple EV makers, but between this and the likely lost production due to the fire, the blow to Rivian is magnified.
What Is the Future of Rivian Stock?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on RIVN stock based on 12 Buys, eight Holds, and two Sells assigned in the past three months, as indicated by the graphic below. After a 30.83% loss in its share price over the past year, the average RIVN price target of $18 per share implies 26.05% upside potential.
