Shares of Rivian Automotive tumbled 16% to a record low on Monday following a report that early investors would sell a portion of their stake in the Ford electric-carmaker.
Shares of Rivian were trading at $24.09, which is a far cry from their record of $179.5 in November last year.
Ford is selling 8 million of its Rivian shares as the stock’s lockup period ends on Sunday, CNBC reported over the weekend, citing sources. Ford was Rivian’s fourth largest shareholder with an 11.4% stake, according to Refinitiv data.
Rivian is struggling in a competitive market, including competition from Ford’s F-150 Lightning electric pickup truck, while a supply chain crisis is limiting production at its plants.
The electric-car maker had earlier cut its planned 2022 production by half to 25,000 vehicles due to supply chain issues.
The California-based company Irvine has lost nearly three-quarters of its value this year, while delivering only 1,227 cars in the first quarter.
Amazon, Rivian’s second-largest shareholder with a 17.7% stake, reported a 59% drop in operating income in its first quarter, largely hurt by its investment in the carmaker. Amazon is also one of Rivian’s major customers and is hoping to get 100,000 delivery vans by 2024.
As CNBC reports, JPMorgan Chase plans to sell the Rivian share block to an undisclosed seller for between 13 million and 15 million Rivian shares, priced at $26.90 per share, similar to Ford’s.
The companies were not immediately available for comment.
Peer shares also fell as investors worried whether the new electric-car maker could build enough electric vehicles to meet rising demand amid supply chain issues and rising material costs.
Shares of Lordstown Motors fell 13% after the company said it needed more money to keep its Endurance pickup truck on the road.