Rivian eyes new debt deal as expected vehicle deliveries slump
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JPMorgan Chase & Co. is leading a potential high-yield bond sale for electronic vehicle manufacturer Rivian, partly to refinance its upcoming debt, according to people familiar with the transaction.
The company aims to raise as much as $2 billion, in part to replace existing bonds that mature in 2026, said the people, who were not authorized to discuss the matter publicly. JPMorgan is sounding out investors on the bond deal, with early pricing discussions around 10%, and a transaction could launch as soon as next week, said the people.
The maker of electric vehicles and trucks has faced numerous challenges as the EV market has cooled, but its CEO is optimistic about Rivian’s future thanks to a joint venture with Volkswagen Group.
A JPMorgan representative declined to comment, while Rivian’s did not immediately respond to a request. The deal is still in the discussion phase and may not happen as planned, if at all, the people cautioned.
The U.S. junk-bond market has shrugged off a spike in jobless claims to rally for three straight sessions. A dip in all-in yields has revived appetite for new deals lately after transactions ground to a near halt in April.
The potential debt deal for Rivian, meanwhile, comes after the company said full-year deliveries will decline more sharply than anticipated just a month earlier. That is due in part to risks that President Trump’s trade war will weaken demand for electric vehicles. Rivian now expects to sell 40,000 to 46,000 battery-powered pickups, SUVs and delivery vans this year, the company said during its first-quarter results call.
Trump’s trade policies, including a 25% levy on imported vehicles and ancillary parts, have prompted automakers around the world to revise their earnings expectations. Rivian Chief Executive Officer RJ Scaringe said tariffs could increase the company’s costs by a few thousands dollars per vehicle.
Rivian builds all of its cars in the United States and said a majority of its components — excluding battery cells — come from the U.S. or comply with a free-trade agreement spanning North America.
The company raised about $1.25 billion in bonds in 2021.
Shah, Weinman and Graf write for Bloomberg.
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