R1S Delivery Update Email (June 30, 2022)

[Sher]

No email today and based on my call with the CS there is no email update coming. The June 11 email was the update. If you have a new window later this year or next, then consider yourself notified.
Reply

Thank you for posting this. I think that’s been the confusion. If June 11 message, then that’s the window. If no June 11 message, then today’s large window is what to expect

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[R1Sky Business]

I‘m an October 21 R1S reservation. We may yet see our Rivians next year. What we don’t know is how many of the reservation holders currently ahead of us will wait for their Rivian and actually buy when their number comes up. Also, I imagine The Store may feature available R1S’s for faster delivery in 2023 like it does now for faster delivery of available R1T’s today.

You think anyone will cancel their order? Or just wait and flip for profit if they've moved on to another vehicle?

 

[Guy]

What data leads to you believe that? They are producing vehicles at the rate they said they would (25k this year), at an increasing rate, with no slowing of demand.

Pushing out R1S doesn't decrease production revenue in the aggregate, if anything it probably increases it.

Producing vehicles at the rate they recently indicated as opposed to targets from late last year.

 

[SASSquatch]

Well, they've unequivocally hit multiple deadlines to-date, but it's easy to just focus on the negative in times of emotional distress and/or just having a generally negative outlook on life.

Couple counter points: interest rates are no higher than we've seen just in the last several years, much less a generation. Secondly, they have little to no affect on demand of luxury goods like a premium EV. Many people are paying cash, and if they aren't higher rates only adding $50/month to a $1,000+ car payment are a rounding error for someone with a $20,000/mo expense budget. As for a few years from now when the more mass market models are released, interest rates are just as likely to be back to all time lows as they are to double again. Nobody knows. Lastly, if we want to get technical, rates are high now because of fears of inflation. An effect of that is people tend to spend money now for fear of it costing more later (which in turn causes more inflation). Also, borrowing is very attractive in an inflationary environment, where you expect to repay a fixed amount with more dollars. This is also why lenders require higher rates of return.

I don't think they have any intention of being cash flow positive for probably 10-15 years, because there is still way to much growth/expansion even after GA (Europe, China, etc.). However, operating profit is something they strive for in the next several years. That's likely to happen once GA is ramped up.

The beauty of a capitalist system is that you can ask people for money to fund stuff that you don't have the ability to fund yourself. So, it's not as much about being profitable or having cash flow, it's about the trend and the story and opportunity. Have those, which they would if they are showing increasing demand and more capacity with GA (with profitability on the horizon), and people will beg you to take their money.

And if all else fails, we the taxpayers will bail them out just like we have before. At least this time we'd be bailing out an innovative company looking to make the world a better place. Seems like a good public investment.

I agree with many of your points. What you have missed in your counterpoints is the impact of their EDV business. Right now, RIVIAN and Stellantis are racing to capture as much market share as they can in this market and they don't have much competition.

RIVIAN will need to balance/prioritize their EDV business as a lifeline for operating cash flow as that business has a higher margin then their R1 vehicles (certainly pre-March 1).

The impact of inflation AND a potential recession could have a significant impact on RIVIAN in the near term as the R1 vehicles fall into the category of luxury, high ticket, goods which are the first ones to curtail in an inflationary/recessionary environment.

I doubt they would have enough cancellations in that scenario to offset their low production volume, which, along with supply chain issues, is their number one hurdle.

I'm not exactly sure where you are getting the "public bailout" of RIVIAN from taxpayers. The only way for RIVIAN to get additional cash flow outside of production volume is via offering additional shares. There is no public bailout that is going to happen here as RIVIAN is not providing a service that is deemed "too important to fail" if we end up in a recession.

They aren't part of the big Detroit auto manufacturers and there is very little appetite in congress to provide a bailout to a luxury auto manufacturer who is producing extremely low volumes.

RIVIAN has enough cash reserves to get through the worst of the supply chain issues, especially if they balance their production volumes with their EDVs. Unfortunately for R1 reservation holders, that will likely mean more delays.

I don't see the R2 being a factor for several years but the R2 will be to RIVIAN what the M3 was to Tesla - except Tesla was days from bankruptcy when Musk was trying to launch the M3 and RIVIAN has $18B in the bank.

 

[Jac]

You think anyone will cancel their order? Or just wait and flip for profit if they've moved on to another vehicle?

Sadly, yes. A lot of high income Americans are ill equipped to weather unexpected personal financial shocks.

 

[Dublin ‘Eer]

Although I’m slightly disappointed, I expected this delay and still hold to something I posted a few weeks ago in a different thread—with inflation where it is and a locked price, my SUV just got 5-10% cheaper which helps make the wait a little more tolerable.

 

[DJG]

I agree with many of your points. What you have missed in your counterpoints is the impact of their EDV business. Right now, RIVIAN and Stellantis are racing to capture as much market share as they can in this market and they don't have much competition.

RIVIAN will need to balance/prioritize their EDV business as a lifeline for operating cash flow as that business has a higher margin then their R1 vehicles (certainly pre-March 1).

The impact of inflation AND a potential recession could have a significant impact on RIVIAN in the near term as the R1 vehicles fall into the category of luxury, high ticket, goods which are the first ones to curtail in an inflationary/recessionary environment.

I doubt they would have enough cancellations in that scenario to offset their low production volume, which, along with supply chain issues, is their number one hurdle.

I'm not exactly sure where you are getting the "public bailout" of RIVIAN from taxpayers. The only way for RIVIAN to get additional cash flow outside of production volume is via offering additional shares. There is no public bailout that is going to happen here as RIVIAN is not providing a service that is deemed "too important to fail" if we end up in a recession.

They aren't part of the big Detroit auto manufacturers and there is very little appetite in congress to provide a bailout to a luxury auto manufacturer who is producing extremely low volumes.

RIVIAN has enough cash reserves to get through the worst of the supply chain issues, especially if they balance their production volumes with their EDVs. Unfortunately for R1 reservation holders, that will likely mean more delays.

I don't see the R2 being a factor for several years but the R2 will be to RIVIAN what the M3 was to Tesla - except Tesla was days from bankruptcy when Musk was trying to launch the M3 and RIVIAN has $18B in the bank.

Yeah, the bailout comment was somewhat tongue and cheek from the GM/GFC nonsense. The left would be so conflicted, they represent the EV dream, but are non-union. They'd be wringing their hands with that one. But let's not kid ourselves, Biden still doesn't even know they exist and thinks GM is the leader of the EV revolution....

 

[DJG]

Producing vehicles at the rate they recently indicated as opposed to targets from late last year.

Well we certainly don't need to rehash it, but there was never targets late last year and they are still well on their way to meeting or exceeding the only targets they have provided formally. I suspect the realignment of R1S will only further accelerate/streamline production this year. And that's the rate for this year and beyond that they have stated publicly will still allow them to self fund through the completion of GA.

If the argument is that people with vastly inferior information still believe a public company is blatantly lying to the market, which would be a crime, well then I guess I don't know what to say.

 

[tk21]

Side note, where did that canyon red R1S photo tied to this thread come from? Tried finding the original without the email over it….

 

[Sully151]

Well, s***.

I had a May/June date for an LE R1T, but switched to an R1S because it is better for my lifestyle.
I did not receive any email today.

I was told switching wouldn't put me in the back of the line, but now I am confused. I should have at least got the first half 23 email for my Aug. 2020 LE order.

 

[BurninAura]

I was expecting a delay into next year, but I wasn't expecting that I would get a window of the second half of next year. I am within the first 1000 reservation holders for an R1S, this will put my wait time at a full 5 years. How do you even call it a Launch Edition at that point.

 

[Mygrain]

Three weeks ago, CS told me that I would not receive an update because I did not have a delivery window estimate to update. It appears that CS got this one right. I remain without a delivery estimate.

But no worries, CS says I'll get an email with my first delivery estimate "in the coming weeks."

Notwithstanding the ever-cheery emails from CS, I'm starting to believe that Rivian wants me to cancel.

 

[IlliniRivian]

You think anyone will cancel their order? Or just wait and flip for profit if they've moved on to another vehicle?

Wait and flip!!! By the time I get my vehicle I expect they’ll have raised the equivalent model another $10k.

 

[astonius]

The email mentions two reasons for the delay. The first is the perennial supply chain issues (ok, fair). Second and seemingly equal in impact is service infrastructure. I find the latter quite funny considering they had no problem delivering my R1T two weeks ago despite a total lack of service infrastructure nearby. Perhaps they're learning from their missteps.

Side note, I've had a laundry list service request open for over a week with no contact beyond the initial request.

 

[AxelR]

The lightning, Silverado, RR EV and such will be the death of Rivian.
They might need to refocus solely on the EDV market.
I’m intrigued how they expect people who need a vehicle to hold over until a truly indefinite date.
During our visit of the SFO SC, the extremely nice person we spent close to an hour with, first asked us why we were getting a S rather a T. That made me think that something was behind it. Aube a need to increase their numbers while using “orphans”, maybe a very far away delivery date for the S. Really anything you can think about is an option at this point.

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