Rivian Automotive has issued a recall of approximately 19,900 R1 models after identifying that an outdated service procedure may have compromised the integrity of the rear toe links. The company traced the issue to a misalignment during post-production calibration, leading to premature wear on suspension components. This action follows internal quality audits that flagged higher-than-expected warranty claims for rear-end handling irregularities. Rivian plans to notify owners by May 15 and will perform free inspections and toe-link replacements at its service centers. The recall is expected to add $75 million to $100 million in repair and logistical costs to Rivian’s second-quarter financials.

Wolfe Research has downgraded Rivian from Peer Perform to Underperform, citing escalating cash burn and deteriorating fundamentals. The firm projects an adjusted EBITDA loss of $2.1 billion for 2026, exceeding consensus estimates of a $1.76 billion shortfall. It also forecasts free cash flow burn to accelerate beyond $4 billion next year, driven by elevated capital expenditures, higher operating costs and working-capital pressures. Wolfe highlighted that near-term demand for the forthcoming R2 model may be volatile, with production volumes skewed heavily toward the fourth quarter of 2026. Unlike competitors with established AI or autonomy launches, Rivian’s next major technology rollout is not expected until late 2026, leaving limited catalysts to support the current valuation.