Rivian, a buzzy electric car manufacturer that aims to compete with companies like Tesla, is facing an investor slump after a sweeping recall has crushed consumer confidence. Late Friday, Rivian announced it plans to recall some 12,000 vehicles for issues related to the steering wheel. These issues could pose a serious threat to drivers – not just Rivian drivers, but anyone who shares the road with them.
The issue impacts a stunning number of Rivian vehicles. While 12,000 might not be a lot for a company like Ford, it’s nearly every car that Rivian has sold. As such, the company’s stock price opened dramatically lower on Monday after the news broke.
The sweeping Rivian recall applies to every single Rivian R1T pickup and R1S SUV created through late September of this year. These vehicles reportedly have a loose fastener in their steering assemblies, creating a looseness in their steering performance that can be extremely dangerous. The company estimates that only around 1% of the recalled vehicles actually have the loose fastener, but they’re checking each pickup and SUV to make sure.
A loose fastener can lead to misalignment of the front wheels, leading to shaking, unusual steering performance, and noise. If the fastener were to come completely loose, it would result in a total loss of steering control, and almost assuredly a car accident.
Customers have already been notified regarding the loose fasteners, and Rivian intends to have technicians check each vehicle and simply tighten the fastener if it’s loose. The company plans to complete the repair process in roughly one month, giving customers a quick turnaround time on having their vehicles made road-worthy.
Automotive recalls are nothing new, but Rivian is under close scrutiny due to its ambitious business plan and aspirations to compete with Tesla. The company is owned by shipping giant Amazon, meaning that many investors have backed Rivian on the strength of its parent company’s name alone. If the nascent electric car manufacturer ends up being unable to produce cars that are safe to drive, its investor backing will evaporate rapidly.
“This is a black eye for Rivian,” writes Wedbush analyst Dan Ives, who closely follows the upstart electric car manufacturer. Rivian is “under a bright spotlight,” Ives explains, saying that the company needs to have smooth product launches and minimal quality control issues if it intends to seriously compete with Tesla.