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Rivian Recalls More Than 17K R1S and R1T Due to Headlight Defect

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Rivian (RIVN - Free Report) is recalling 17,260 vehicles in the United States due to a headlight malfunction that could impair visibility and increase the likelihood of an accident. Per the National Highway Traffic Safety Administration report, the recall covers certain 2025 R1S SUVs and R1T pickup trucks. The issue was discovered when the company determined that the headlights on some 2025 models did not comply with Federal Motor Vehicle Safety Standard number 108, “Lamps, Reflective Devices, and Associated Equipment.”

In cold weather, the low-beam headlights may fail to turn on when the vehicle starts. A warning message will appear on the driver display stating, “Low beam lights not working. Service low beams soon.” If this warning is ignored and the vehicle is driven in low-visibility conditions, the risk of an accident increases.

To address the problem, Rivian will replace the headlight control modules free of charge. Notification letters will be sent to affected owners starting March 28, 2025. RIVN has not received reports of any accidents or injuries related to this issue. The problem arose due to incorrectly configured parts it received from the supplier, affecting vehicles built between April 29, 2024, and Feb. 3, 2025.

In the fourth quarter of 2024, Rivian’s revenues reached a record high, driven by higher sales of regulatory credits, growth in software and services and a boost in R1 average prices with the Tri-Motor option now available. The biggest highlight was Rivian achieving a gross profit for the first time in the fourth quarter of 2024. The company managed to cut $31,000 in cost per vehicle compared to the same quarter last year due to improvement in cost-cutting measures, efficiency in variable and fixed costs and higher revenue per vehicle. Gross profit came in at $170 million against the $660 million gross loss in the fourth quarter of 2023.

Despite its progress, Rivian acknowledged that external challenges could weigh on 2025 sales. Potential changes in government policies, including shifts in EV incentives and tariffs under the Trump administration, could impact demand. As such, the company provided a lower delivery forecast of 46,000 to 51,000 vehicles for 2025 compared with 51,579 units delivered in 2024.

RIVN’s Zacks Rank & Key Picks

Rivian carries a Zacks Rank #3 (Hold) at present.

Some better-ranked stocks in the auto space are Geely Automobile Holdings Limited (GELYY - Free Report) , Dana Incorporated (DAN - Free Report) and Strattec Security Corporation (STRT - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for GELYY’s fiscal 2025 sales and earnings indicates year-over-year growth of 66.62% and 149.31%, respectively. EPS estimates for fiscal 2025 and 2026 have improved by 15 cents and 38 cents, respectively, in the past 60 days.

The Zacks Consensus Estimate for DAN’s 2025 earnings implies year-over-year growth of 59.57%. EPS estimates for 2025 and 2026 have improved by 20 cents and 40 cents, respectively, in the past 30 days.

The Zacks Consensus Estimate for STRT’s 2025 sales indicates year-over-year growth of 2.61%. EPS estimates for 2025 and 2026 have improved by 91 cents and $1.06, respectively, in the past 30 days.

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