Rivian’s bet on a cheaper electric SUV is paying off sooner than many expected. The company said on Thursday that its R2 became its best selling vehicle by volume in the third quarter, overtaking its larger R1 models and its commercial delivery van in the model’s first full quarter on sale.
The result arrived with a record quarter for the company as a whole. Rivian built 19,751 vehicles and delivered 19,248 in the three months, a sharp rise on the 12,194 deliveries reported in the second quarter, helped by a second production shift at its factory in Normal, Illinois. The company did not break out an exact R2 sales figure, saying only that the model was responsible for much of the quarter on quarter gain.
A cheaper car doing the heavy lifting
The R2 launched in June at a starting price of just under $60,000, well below Rivian’s larger models, and the company has said cheaper versions will follow. That pricing matters in a market where buyers lost the $7,500 federal tax credit last year, a change that has pushed several large car makers back toward petrol and hybrid models and left more room for companies that sell only electric vehicles.
Rivian’s wider ambitions stretch beyond the car itself, as shown when Doug Fields took on running Rivian’s billion dollar industrial robotics startup.
Confidence in the R2’s pace is visible in the company’s updated outlook. Rivian raised the lower end of its full year delivery forecast from 65,000 to 67,000 vehicles, keeping the top end at 70,000, a second increase this year. It is now on course to break a run of three years in which annual deliveries struggled to pass 50,000.
Software helps balance the books
Revenue rose 38 percent to $2.155 billion in the quarter, while the net loss narrowed to $913 million from about $1.2 billion a year earlier, according to reports. The car making business still lost money at the gross level, recording an $80 million automotive gross loss against $130 million a year earlier, but software and services brought in $605 million of revenue, up 45 percent, including $354 million tied to its Volkswagen joint venture.
That split underlines how much of a modern car maker’s story now sits in software rather than steel, a shift already visible in the way Google has put its inbox and calendar behind the wheel with Gemini. For Rivian, the test now is whether R2 volume can keep rising without the ramp up costs eating the gains, and whether cheaper versions arriving later can widen its audience further without cutting prices too far.
