Leasing NOT offered at pre price-hike prices for reservation holders

[Rivdog]

This is a choice on their part. Arbitrary. The point of having non-transferable reservations was to avoid selling (scalping) reservations. That has zero bearing on me leasing the vehicle.

It was actually because Rivian was trying to exert goodwill towards the early adopters, not to avoid scalping. That happened anyway on the back end, as we all saw for early deliveries.

Rivian specially advised us all on our pre-orders that the price was subject to change and we weren’t locking in a price. Rivian reversed course, which is definitely not what any other vehicle manufacturer did during COVID. I assume you didn’t try to order a Lightning if you think Rivian’s decision was the norm.

Take a step back and imagine yourself being approached by a customer acting like you are and decide how you’d react. I certainly would be happy to decline on any business with that person.

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[Nsblifer]

I’m not upset about it but actually agree with you. Wish they’d offer leasing to preorders. Yes, we still exist. Someone mentioned it wouldn’t be profitable for them since there is no guarantee of purchase at lease expiration…well neither is selling the vehicle at $80k. That makes no sense. It’s more profitable than trucks sitting on the lot.

 

[Tr4ckD4ys]

Wow… finally some action on this forum… unfortunately it appears the OP has now disappeared and we will not be offered any further entertainment from him/her.

 

[COdogman]

Wow… finally some action on this forum… unfortunately it appears the OP has now disappeared and we will not be offered any further entertainment from him/her.

I assume he is currently in a meeting on a yacht in international waters with his fellow important bankers who want to lease their vehicles at discounted prices.

 

[Stevetom84]

At some point will Rivian tell pre hike reservation holders that they need to lock in their configuration for delivery or lose pricing? Production is getting caught up, dual motor is out, max pack is out, etc. So backlog is becoming less of an issue. I’m assuming pre-hike pricing can’t be held indefinitely.

 

[Whatever_this_is]

At some point will Rivian tell pre hike reservation holders that they need to lock in their configuration for delivery or lose pricing? Production is getting caught up, dual motor is out, max pack is out, etc. So backlog is becoming less of an issue. I’m assuming pre-hike pricing can’t be held indefinitely.

I assume they would do that right before they drop prices back to pre-March

 

[s4wrxttcs]

You know what else is a heck of a thing? Corporate finance and accounting. Too bad Rivian doesn't seem especially well versed.

I'm confused by why you're assuming its a finance and accounting issue, and not purely a profitability question.

From a legal standpoint Rivian was never obligated to honor the reservation pricing. They only decided to honor the reservation pricing due to an enormous levels of cancelations when Rivian increased the price.

The leasing option gives them a low drama way out of honoring the reservation price. The number of people canceling because they can't get reservation pricing on a lease is likely relatively low due to leasing not even being an option until recently.

 

[djsider2]

I assume they would do that right before they drop prices back to pre-March

Taking a page out of Tesla playbook is not going to sit pretty with the community.

 

[Supratachophobia]

There’s a lessor company involved via Chase. It’s not the same arrangement.

This is actually strong motivation to not lease. I'd rather not line the pockets of Dimon almost as much as I don't want to benefit Musk.

I have an allergy to out of touch billionaires.

 

[Supratachophobia]

At some point will Rivian tell pre hike reservation holders that they need to lock in their configuration for delivery or lose pricing? Production is getting caught up, dual motor is out, max pack is out, etc. So backlog is becoming less of an issue. I’m assuming pre-hike pricing can’t be held indefinitely.

As someone still on the fence but also owns stock, yes, they should. I imagine it will be just prior to Enduro quad. They'll say the quad Enduro is an iterative enough difference from what we originally ordered and that PPH won't apply to us. Then they'll say you have 90 days to get a vehicle or here is your $1000 back.

 

[carsly]

If I were working at Rivian, and I don't and never have, I would announce all pre-orders expire on a impending date - say March 15th, 2024 or basically two years after the prices locked. Heck, there has been 12-15% inflation since then anyway so there should be no reasonable customer expectation of a perpetual price lock/hold.

Rivian wins - forces orders to close in Q1 (which they will desperately need). Customers who are on the fence win - the pre-hike prices would not hold in today's market anyway.

THEN....during the Q1 earnings call announce that prices are falling across the board for the R1 line due to manufacturing efficiencies. Add in standard pack and waits will go from 1-2 weeks to 1-3 months which is probably closer to where Rivian wants them to have some demand predictability. That buys them two more quarters of volume.

Q4 2024 is going to be the tough one. Not sure what might help demand, perhaps lower interest rates. But many/most may hold off until the NACS port-equipped vehicles are available at the end of 2024 for the 2025 model year.

Somehow, they need to get through 2025 before R2 appears on the horizon for 2026. I don't think they can move 100,000 vehicles a year at current prices - even Tesla isn't moving nearly that many Model S/X.

 

[Supratachophobia]

If I were working at Rivian, and I don't and never have, I would announce all pre-orders expire on a impending date - say March 15th, 2024 or basically two years after the prices locked. Heck, there has been 12-15% inflation since then anyway so there should be no reasonable customer expectation of a perpetual price lock/hold.

Rivian wins - forces orders to close in Q1 (which they will desperately need). Customers who are on the fence win - the pre-hike prices would not hold in today's market anyway.

THEN....during the Q1 earnings call announce that prices are falling across the board for the R1 line due to manufacturing efficiencies. Add in standard pack and waits will go from 1-2 weeks to 1-3 months which is probably closer to where Rivian wants them to have some demand predictability. That buys them two more quarters of volume.

Q4 2024 is going to be the tough one. Not sure what might help demand, perhaps lower interest rates. But many/most may hold off until the NACS port-equipped vehicles are available at the end of 2024 for the 2025 model year.

Somehow, they need to get through 2025 before R2 appears on the horizon for 2026. I don't think they can move 100,000 vehicles a year at current prices - even Tesla isn't moving nearly that many Model S/X.

Couple comments. I'm cool with an expiration like your mentioned. It would definitely push me to purchase knowing that they won't let me lease at PPH now. And I think your timing based on what we know is pretty clever.

I still don't think NACS matters if adapters are a thing. We all just want access to that sweet sweet supercharger network, I don't really care how it plugs in.

Not sure why others aren't getting an S or X. But I'd be behind the wheel of a new one right now if Musk wasn't at the wheel of Tesla.

 

[DuoRivian]

If I were working at Rivian, and I don't and never have, I would announce all pre-orders expire on a impending date - say March 15th, 2024 or basically two years after the prices locked. Heck, there has been 12-15% inflation since then anyway so there should be no reasonable customer expectation of a perpetual price lock/hold.

Rivian wins - forces orders to close in Q1 (which they will desperately need). Customers who are on the fence win - the pre-hike prices would not hold in today's market anyway.

THEN....during the Q1 earnings call announce that prices are falling across the board for the R1 line due to manufacturing efficiencies. Add in standard pack and waits will go from 1-2 weeks to 1-3 months which is probably closer to where Rivian wants them to have some demand predictability. That buys them two more quarters of volume.

Q4 2024 is going to be the tough one. Not sure what might help demand, perhaps lower interest rates. But many/most may hold off until the NACS port-equipped vehicles are available at the end of 2024 for the 2025 model year.

Somehow, they need to get through 2025 before R2 appears on the horizon for 2026. I don't think they can move 100,000 vehicles a year at current prices - even Tesla isn't moving nearly that many Model S/X.

Good points. But since standard battery is coming out in the next few mi the I would expect quite a bit of backlog since it was announced in March 2022. Agree 2025 may be a bit tough.

 

[djsider2]

If I were working at Rivian, and I don't and never have, I would announce all pre-orders expire on a impending date - say March 15th, 2024 or basically two years after the prices locked. Heck, there has been 12-15% inflation since then anyway so there should be no reasonable customer expectation of a perpetual price lock/hold.

Rivian wins - forces orders to close in Q1 (which they will desperately need). Customers who are on the fence win - the pre-hike prices would not hold in today's market anyway.

THEN....during the Q1 earnings call announce that prices are falling across the board for the R1 line due to manufacturing efficiencies. Add in standard pack and waits will go from 1-2 weeks to 1-3 months which is probably closer to where Rivian wants them to have some demand predictability. That buys them two more quarters of volume.

Q4 2024 is going to be the tough one. Not sure what might help demand, perhaps lower interest rates. But many/most may hold off until the NACS port-equipped vehicles are available at the end of 2024 for the 2025 model year.

Somehow, they need to get through 2025 before R2 appears on the horizon for 2026. I don't think they can move 100,000 vehicles a year at current prices - even Tesla isn't moving nearly that many Model S/X.

I don’t think they’ll make these exact versions cheaper but might start cheapening or removing features to get a lower price point.

In the realm of resale value and current customer sentiment, I wouldn’t pull a Tesla and drop the prices on these exact configurations.

 

[Supratachophobia]

Good points. But since standard battery is coming out in the next few mi the I would expect quite a bit of backlog since it was announced in March 2022. Agree 2025 may be a bit tough.

Good points. But since standard battery is coming out in the next few mi the I would expect quite a bit of backlog since it was announced in March 2022. Agree 2025 may be a bit tough.

I definitely think they'll throw LFP cells in the current form factor to give us the standard pack. The math lines up. 260-270 full charge on dual-non performance with no software unlock option.

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