After sharing snippets of information and a few images here and there, Rivian has officially lifted the veil on the third vehicle it’s bringing to market, the R2 SUV.
This more affordable electric SUV will play a major role in shaping the company's future prospects. The company's two current models, the R1T pickup and the R1S SUV, are certainly elegant, but their prices are not accessible to all.
The R2 will be offered at a starting price of $45,000 USD, which is sure to appeal to many buyers already interested in the products of this relatively new firm.
Production won't start until 2026, however. A number of things could change between now and then, including the announced price. Let's just say we've seen this before. Nevertheless, Rivian will probably be very aggressive, as it needs an affordable model to compete with Tesla and all the other manufacturers promising, in the short and medium term, cheaper electric models.
Yesterday, we revealed a few details about the model, including its dimensions and range, which were confirmed at the official unveiling. What catches the eye is the estimated range of 330 miles, or 531 kilometers. The R2 will offer a host of accessories sure to interest outdoor enthusiasts, such as a bike attachment system that connects easily to the rear of the vehicle.
But beyond what it promises and will eventually offer, challenges remain for Rivian. The firm reported losing $1.58 billion USD in the last three months of 2023, taking its net annual losses to $ 5.4 billion. The company lost tens of thousands of dollars per vehicle sold last year, as it struggled to increase production and generate demand beyond the initial wave of buyers.
Rivian's shares have lost 53 percent of their value since the start of this year, weighted down by disappointing delivery figures and its February announcement that production growth in 2024 was expected to be zero.
But that's not all. Rivian has also announced plans to lay off 10 percent of its salaried staff, the third such round of layoffs in the last two years. Rivian is expected to close its Normal, Illinois plant for several weeks in order to make improvements to the line that produces the R1T.
At the same time, it plans to build a $5 billion plant in Georgia, to produce the R2 starting in 2026.
The company's executives wearing reassuring faces, mind you. In February, Rivian boss RJ Scaringe said that the mid-size SUV segment targeted by the company was “a massive market with few compelling options for electric vehicles other than Tesla.”
Rivian spokeswoman Marina Hoffman said the company had a “clear vision toward profitability,” citing efforts to cut costs and increase efficiency at its Illinois production plant. The company has reduced the number of shifts to build the same number of vehicles, and is currently renegotiating contracts with suppliers.
Time will tell if these decisions are the right ones. We hope so, for the sake of the company, its employees and consumers, who always benefit when the offer is as diversified as possible.
