Rivian Stock Is Falling on a Downgrade. Yes, It’s Trump.

Coming into Monday trading, Rivian stock was down about 2% year to date, and off about 28% over the past year. (Mario Tama/Getty Images)

Rivian Automotive stock dropped early Monday after catching a downgrade. There are too many headwinds right now for U.S. electric-vehicle makers.

Shares of the EV start-up lost 2.2%, closing at $12.75, while the S&P 500 and Dow Jones Industrial Average gained 0.1% and 0.2%, respectively.

The drop came after Guggenheim analyst Ronald Jewsikow cut his Rivian rating to Hold from Buy. He also dropped his price target of $16.

“Continued R1 softness and the ‘OBBB’ introduce fundamental and narrative risks to our long-term R2/R3 bull thesis that cannot be ignored,” wrote Jewsikow in a Monday report.

The OBBB, short for President Donald Trump’s One Big, Beautiful Bill, was passed into law recently. The act eliminates EV purchase tax credits worth up to $7,500 for a qualifying EV purchases in September. Losing the tax credit will make it harder to sell more EVs.

Sales growth has already been a struggle for Rivian in 2025. The company plans to sell about 43,00o of its R1S and R1T vehicles. It sold almost 52,000 R1 vehicles in 2024. The R1 family of vehicles is the company’s first-generation EVs. It plans to start selling lower-priced R2/R3 models in 2026.

Emission policy changes represent another potential headwind for shares. Congress is challenging California’s ability to regulate its air emissions, which form the basis for Rivian’s sales of zero-emission vehicle credits.

“Net/net, we now project 150,000 [sales] units in 2028 versus 185,000 prior,” added Jewsikow.

That is substantially below the current consensus. Wall Street projects 2028 sales of 282,000 vehicles, according to FactSet. That isn’t enough to generate positive operating income. Mass-market car companies typically have to generate sales of roughly 400,000 vehicles to break even. EVs and conventional cars have about the same margins.

Overall, 26% of analysts covering Rivian stock have Buy ratings, according to FactSet. The average Buy-rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target for Rivian stock is just under $15.

Coming into Monday trading, Rivian stock was down about 2% year to date, and off about 28% over the past year.

Write to Al Root at allen.root@dowjones.com