Rivian Automotive plans to lift $1.3 billion in money through a sale of convertible notes, becoming a member of a rising record of EV makers scrambling to hoard money as demand falters.

Shares of Rivian closed down over 14% on Tuesday.

Rivian mentioned late Monday it plans to promote the convertible notes — bonds that may be paid again with money, inventory or a mixture of the 2 — to assist fund the event and launch of its upcoming smaller R2 collection of autos, now anticipated in 2026. The institutional traders buying the notes could have the choice to purchase further notes value as much as $200 million, in the event that they select, above the preliminary $1.3 billion.

Rivian is not in an pressing money crunch, no less than not but. The EV maker had $12.1 billion available as of the tip of 2022, it mentioned throughout its fourth-quarter earnings presentation Feb. 28, sufficient to fund its operations by means of 2025. Nevertheless it just lately made a collection of strikes to preserve money, shedding 6% of its workforce and pushing the R2 launch out a 12 months.

Rivian additionally mentioned final week that it expects to supply 50,000 autos in 2023, fewer than the roughly 60,000 that Wall Road analysts had anticipated. That could be an indication that demand for its high-priced pickups and SUVs is falling wanting its expectations.

Lucid, one other startup making high-priced electrical autos, additionally guided traders to lower-than-expected manufacturing in 2023 and mentioned that it plans to ramp up its advertising and marketing in coming months, suggesting that it too is seeing fewer orders than anticipated.

Rivian raised almost $12 billion when it went public in late 2021, serving to it amass a money hoard that also dwarfs that of most different EV startups. The corporate’s shares have misplaced over 80% of their worth because the debut, although.

Rivian mentioned the convertible notes will qualify as “inexperienced bonds,” that means they meet a set of standards that tends to draw establishments prepared to simply accept decrease returns in change for supporting sustainable improvement.

The notes will mature in March 2029. The rate of interest and different phrases shall be determined when the providing is priced.