Rivian expects net loss of around $ 1.2 billion in third quarter due to rising electric vehicle production costs

Rivian Automotive Inc., the Amazon-backed electric pickup maker preparing to go public, expects to report a quarterly net loss of up to $ 1.28 billion from costs associated with starting production of its first truck.

Losses have been increasing for a year due to “significant labor and overhead costs” at its Normal, Ill., Plant, the startup said in a filing on Friday. The net loss for the period ended September 30 will range from $ 1.18 billion to $ 1.28 billion, according to preliminary results.

“While we were just starting to ramp up vehicle production at the site, the facility produced limited quantities of vehicles during the period,” the company said. The operating loss for the quarter is expected to be between $ 725 million and $ 775 million.

The company, which started delivering the R1T truck in the last quarter, previously reported a net loss of nearly $ 1 billion in the first half of the year.

Rivian is one of the more serious contenders poised to take on electric vehicle leader Tesla Inc. He was looking to be valued at around $ 80 billion in a list, Bloomberg News reported in August when the company announced. that it had confidentially filed for an IPO.

CEO RJ Scaringe could retain control of Rivian through a share class giving him 10 votes per share out of the single vote allotted to each common share, according to the amended record. He did not specify the percentage of voting rights or the total number of shares Scaringe will hold.

To attract retail investors, Rivian plans to allocate a portion of its IPO to personal finance startup SoFi Securities LLC’s online brokerage platform, the company said. Rivian also announced the issuance of over $ 1 billion in non-convertible debt securities during the three-year period.

The company continues to indicate the size of its offering at $ 100 million, an amount of placeholder will change when the terms of the sale of shares, including the price range, are set.

Rivian also said that the claims made by Tesla in trade secret lawsuit are “without merit”. The company has previously said only that it aims to defend itself in the lawsuit.