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Rivian (NASDAQ:RIVN) stock is slumping today on reports that the electric vehicle (EV) company’s workers have called out multiple safety violations.
According to several media reports, about a dozen employees at Rivian’s plant in Illinois have accused the company of compromising safety. That news is pushing RIVN stock down about 2% today. The company is also trending on social media.
On a year-to-date (YTD) basis, RIVN stock is down 70% as well. Shares trade at roughly $30 apiece.
What’s Happening With RIVN Stock?
Rivian employees have filed complaints against the company with the federal government in Washington, D.C. alongside the United Auto Workers union. In the filings, they accuse Rivian of ignoring “known hazards” and turning a blind eye to potential safety risks. The filing also lists several injuries suffered by employees at the Illinois manufacturing plant, including “a crushed hand, a broken foot, a sliced ear and broken ribs.”
Rivian is disputing these allegations, per Seeking Alpha, but the company has refused to comment on or discuss issues raised in the complaints, citing employee confidentiality. However, Rivian did note that the complaints made in the filing represent only 0.2% of workers at the Illinois EV plant. The safety complaints also come alongside organization efforts from the United Auto Workers union.
Why It Matters
News of the safety issues at Rivian’s plant and efforts to unionize the company’s workers comes at a sensitive time for the automotive industry, electric vehicle makers and RIVN stock. Ongoing supply-chain issues and slowing economic growth have already negatively impacted both manufacturing and vehicle sales to consumers.
For RIVN, this negative news is only further hurting its share price. The stock has already plunged this year as investors move away from startups and other riskier investments. Instead, many investors are now seeking safe havens amid ongoing marker volatility. Today’s news of employee safety complaints, coupled with a union drive, are additional headaches that the company doesn’t need right now.
Looking forward, the safety complaints that have been filed with the federal government will likely start a process that could involve safety inspections at Rivian’s Illinois plant as well as a more aggressive push from the United Auto Workers. These events will also likely play out over several weeks or months rather than days. As such, a cloud could continue to hang over RIVN stock for the foreseeable future. Investors should proceed with caution.
On the date of publication, Joel Baglole did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.
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