By Sam Boughedda
Investing.com -- A few days after announcing price increases, Rivian Automotive Inc (NASDAQ:RIVN) has backtracked, stating they "broke the trust we have worked to build with you."
Whether this will help calm the backlash is yet to be determined. However, Rivian shares have continued to fall Thursday, down 3%, adding to Wednesday's 13% decline.
On Tuesday, the electric vehicle company angered customers by revealing it has increased the selling prices of its vehicles by about 20% due to inflationary pressures and higher component costs. The price increases affected most customers who had already placed preorders for the vehicles.
However, just two days later, Rivian has backtracked. In a letter to customers, the Amazon-backed firm's CEO RJ Scaringe apologized.
Scaringe explained that the costs of the components and materials that go into building their vehicles have risen considerably.
"As we worked to update pricing to reflect these cost increases, we wrongly decided to make these changes apply to all future deliveries, including pre-existing configured preorders," he explained.
Scaringe continued: "As we demonstrated earlier this week, trust is hard to build and easy to break. In speaking with many of you over the last two days, I fully realize and acknowledge how upset many of you felt. I have made a lot of mistakes since starting Rivian more than 12 years ago, but this one has been the most painful. I am truly sorry and committed to rebuilding your trust."
"...For anyone with a Rivian preorder as of the March 1 pricing announcement, your original configured price will be honored. If you canceled your preorder on or after March 1 and would like to reinstate it, we will restore your original configuration, pricing and delivery timing. Our team will be sending an email in the next few days with more details."