Rivian, the electric vehicle (EV) innovator known for its premium R1T pickup and R1S SUV, is gearing up to launch its more affordable R2 midsize SUV in 2026. Priced between $45,000 and $50,000, the R2 aims to capture a broader market, boasting a 300-mile range, tri-motor options hitting 0-60 mph in under three seconds, and production starting at its Normal, Illinois plant. With over 100,000 preorders already, the R2 promises to be a pivotal moment for Rivian as it strives for profitability amid a competitive EV landscape. But a bold claim has emerged: "They will sell a mediocre amount in the beginning but it will destroy 90% of the desire for any of their other models. So net loss." Let’s unpack this.
Initially, the R2’s lower price and compact design could indeed draw buyers away from the pricier R1 lineup, which starts at $70,000. Early sales might be "mediocre" due to production ramp-up challenges—Rivian has faced supply chain hiccups before—or hesitancy from loyalists who prefer the R1’s luxury appeal. If the R2 overshadows the R1T and R1S, cannibalizing their demand, Rivian could see a net loss in revenue since the R1 models carry higher margins. The claim suggests that 90% of interest in Rivian’s flagship offerings might evaporate, a drastic shift that could strain the company’s finances as it burns through cash to scale R2 production.
But is this idea overlooking Rivian’s strategy. The R2 targets a distinct, mass-market segment, while the R1 lineup caters to adventure-seeking premium buyers. Both could coexist, much like Tesla’s Model Y and Model X. Strong R2 sales might even bolster Rivian’s brand, driving long-term growth. What do you think, readers? Will the R2 doom Rivian’s other models, or is it a smart expansion?
And is it just us or does the design look like a butch Hyundai Ioniq 5?
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