Rivian R2 Launch Looks Like A Damp Squib

Rivian and Lucid have NEVER had even a story about how they would become profitable, which makes the $35+ billion investors have given them quite astonishing. Tesla sets the market prive and I have been asking since 2018 if not earlier how new American EV companies think they can profitably make competitive EVs at competitive prices with enormous scale of production, technology of production, experience of production and vertical integration disadvantages against Tesla? Nobody has ever had a suggestion of an answer, all I have heard is look how great their cars will be/are. Fine, and yes no EV company has become profitable in less than ten years of production, but are these companies going to have five more years worth of cash to burn?

The only way this works is if Rivian can convince buyers that their R2 is worth $10,000 more than a Model Y, and the Model Y has the killer app of full self driving. Yes, Rivian says coming soon, but come on, it will be four plus years behind what Tesla has. Maybe if Rivian can get a new plant built they can start using gigacastings, which I am sure those machines will not fit in their current factory.

I just think Rivian is another $30 billion in losses away from any chance of sustainable profit, and thirty plus years from breaking even on all the burned capital if things go great. All the investors should have bought bonds.

10:12 The R1 has more room than the R2. That's why someone would pay more. Some car buyers don't like Elon Musk and will go for an electric vehicle that's not a Tesla.

Rivian is likely to be folded into VW in time. They are going to run out of money, sadly.

The aesthetics of the front end kill it. I understand that there are some of you who like the aesthetic. Unfortunately, you are in the minority. Not very many people are going a pay a premium for sub-5 aesthetics. The Cybertruck knows this, and sub-5 men know this.

‚Only‘ 45000$…

Rivian is certainly in a dicey spot, but I’ve worked in automotive and followed the news in the space, and I can’t help but feel you’re hunting for justifications to be pessimistic about their demise.

The Tesla 3 and Y did cannibalize the models S and X, which dwindled to nothing and got discontinued, but Tesla refused to develop a second-generation S or X or even do a major refresh, to the complete bafflement of people who follow these things. The luxury market is fickle, and Tesla themselves seemed to lose interest in those models years ago. There’s no reason it had to happen that way.

I actually can see Rivian’s 50% production cost improvement as plausible. The R1’s manufacturing cost seems extremely high for an SUV of that size, and there’s only so much you can fix with a refresh. Unit economics are also rough on low-volume vehicles, and doubly so if you aren’t pilfering from your other vehicles or dipping into a major player’s parts bin.

Subsidies are gone, but we’re entering into a period of what appears to be sustained high gas prices. Everyone I know with a large SUV is grumbling about how much fuel is costing them, while also refusing to downsize. An EV rebound is not impossible, especially as we move beyond the time period people were pulling purchases forward by and people choose to walk away from their old EV leases rather than overpay to buy out a car with an old-style charging port.

The initial buzz around the R2 seems good, at a time when people appear to be fairly cynical about new models as a whole. Haven’t seen an R2 in person yet, but it looks bigger than what you consider as comps.

If they’re dependent on rapidly taking 20% EV marketshare so they can hit 100% factory utilisation though, that very much is a problem. I haven’t seen anyone successfully ramp up that much that fast who wasn’t replacing a 200k/yr seller with the next-gen version of the same model. It seems like such a wild assumption that I’m wondering if they’re actually using that in their internal math.

And even if everything does go sideways, it seems like some sort of lifeline from VW may be possible, given that VW is struggling at EVs, outdoorsy lifestyle SUVs, and the American market in general. Might not be great for the share price, but I think they’re more likely than the other US EV startups to stick around in some form or another.

Electrek is not a reliable or unbiased source for EV news btw.

how to out yourself as a TSLA shareholder- post a FUD video about RIVN at its inflection point 🤣

Imagine all of the people who bought into Rivian stock at $78, thinking that the company was "The Next" Tesla 😅

You forgot about the rivian ebike they keep promising as well. Though that is a very dumb ebike for so many reasons.