Both electric vehicle firms Rivian and Lucid warned about higher costs from U.S. tariffs on imported vehicles and auto components. The automotive industry continues to adapt their supply chains as leading companies Rivian and Lucid announce higher production costs due to U.S. vehicle and parts tariffs.

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EV manufacturers now have to navigate additional trade restrictions which increase their production challenges while sales decline because economic instability reduces customer enthusiasm. The market shows two major trends: consumers choose hybrids over traditional vehicles and postpone their car buying decisions.

According to Reuters the rise in Rivian's per-vehicle costs will amount to "a couple of thousand dollars" directly because of the imposed tariffs. According to Scaringe consumers today exhibit elevated purchasing caution by prioritizing reduction in costs above previous spending habits. As part of its supply chain transformation plan Rivian addresses how to minimize the financial consequences of these import tariffs. The company made an updated 2025 vehicle delivery estimate which reduced the expected number of vehicles between 40,000 and 46,000 units from its initial projection of 46,000 to 51,000 deliveries.

Also Read | Lucid surpasses revenue estimates, reaffirms production targets amid strong demand for EVs

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The luxury electric vehicle manufacturer Lucid faces rising overall expenses by 8% to 15% according to interim Chief Executive Marc Winterhoff prior to implementing any cost reduction strategies. Even though Lucid maintained a year-end production target of 20,000 units the company's CEO Marc Winterhoff stated this target was already too conservative since their upcoming SUV launch demanded additional consideration.

Rivian's stock took a small downward trend after the market exchanging hours while Lucid's stock gained modest ground. The automotive sector expresses widespread worry about the Trump administration's decision to impose 25% tariffs on both imported vehicles and auto parts. Similar to the recent government announcement which aimed to minimize the effects of these tariffs the price impact persists as a major industrial issue. The ongoing trade uncertainty has pushed Tesla and other automakers to examine their full-year target numbers.

Rivian dedicated USD 120 million to create a supplier park adjacent to its Illinois manufacturing facilities to optimize its supply routes before introducing its budget-friendly R2 SUV models later this year. Lucid remains undecided about manufacturing its upcoming USD 50,000 midsize vehicle in Saudi Arabia rather than the United States to bypass tariff expenses. Both Rivian and Lucid depend on the successful expansion of budget-friendly models to drive their long-term expansion potential. Both automotive companies delivered better-than-forecast earnings per share results after implementing intensified cost reduction programs. Rivian achieved gross profit of USD 206 million and it maintains positive expectations for getting modest gross profit this year. This information came from its ongoing substantial software partnership with Volkswagen. The company boosted its capital expenditure predictions for the year because plant expansion costs became more expensive due to trade regulations.