Rivian Automotive Inc (NASDAQ:RIVN) shares slumped more than 7% after the electric vehicle maker was downgraded by Bank of America analysts.
They downgraded Rivian to “Underperform” from “Neutral” and awarded it a $10 price target, down from $13. Shares traded down 7.5% at $12 late morning on Monday.
“We reduce our 2025 and longer-term forecasts as we contemplate guidance, 4Q earnings call commentary, and the competitive landscape, among other factors,” the analyst wrote in a note to clients.
The analysts noted while Rivian is one of the most viable startup EV OEMs and is making progress toward sustainably positive gross margins, risks are piling up.
Rivian’s 2025 outlook was softer than expected, projecting an adjusted EBITDA loss of $1.7 billion to $1.9 billion compared to the consensus of a $1.7 billion loss.
“While the guidance has a cushion in the ‘hundreds of millions’ to EBITDA for potential changes to incentives, regulations, and tariffs, there could be more downside risk if policy changes are enacted,” they wrote. “Rivian highlighted impacts from seasonality and the wildfires in Los Angeles, but demand also appears generally soft.”
The company is also facing increasing competition as new SUVs and CUVs enter the market in 2026 and 2027, analysts highlighted.
“There are a growing number of electric SUV/CUVs entering the market which, coupled with what appears to be a slower-than-expected ramp of the R2, could hinder Rivian's longer-term volume trajectory,” they wrote.
“Among the competition, Lucid has launched the Gravity SUV and plans to add a mid-sized SUV/CUV in late 2026. Scout is planning to start production of the Traveler SUV and Terra Truck in 2027, which appear likely to compete directly with Rivian's vehicles, but be priced meaningfully lower with base models starting under approximately $60,000.”