Q4 2024 Gross Profit of $170M for Rivian

[R1TS]

RJ is a great mind when it comes to engineering. Just not what’s needed for Rivian. They need someone more experienced in business ops and management.

There’s less and less demand for very expensive trucks. Yet, RJ and Rivian continue to release trucks with ever increasing prices.

Someone is definitely not seeing beyond the Rivian walls.

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[Hereforthesnacks]

I couldn't disagree with you more.
RJ is following RJ's (Rivian's) playbook.

And I for one (don't believe I'm alone) believe RJ Scaringe is one of the biggest benefits and absolute best chance Rivian has to succeed, bar none.

He has an Engineering background and mentality. In the days of late-stage-capitalism focused on profits before progress and instant gratification for figuring out the next quarter, RJ and his team are thinking 5 and 10 years down the road. THAT is what they need for long-term growth.

My completely unsolicited .02 anyway...

Your 0.02 is worth just as much as mine! Maybe more! Totally fair to have a different take.

I’m pretty confident in my assessment though. Rivian’s playbook is essentially undifferentiated from Tesla’s. And they have very little opportunity to raise unrestricted cash for 4 years, but only have 3 years of cash left.

Rivian will also have a hard time posting a meaningful profit for Q1 ‘25. My call is Rivian at $11 in April.

I don’t see any real vision with this leadership other than the R2 will be volume. I don’t see R2 priced below $50k for a trim with reasonable range. And at that price it will compete with a ton of other offerings.

 

[godfodder0901]

There’s less and less demand for very expensive trucks. Yet, RJ and Rivian continue to release trucks with ever increasing prices.

Someone is definitely not seeing beyond the Rivian walls.

Yeah, that's why the have the R2 and R3 in the works... The R1 series was never intended to carry the load, only introduce the brand.

 

[Donald Stanfield]

RJ is a great mind when it comes to engineering. Just not what’s needed for Rivian. They need someone more experienced in business ops and management.

There’s less and less demand for very expensive trucks. Yet, RJ and Rivian continue to release trucks with ever increasing prices.

Someone is definitely not seeing beyond the Rivian walls.

Yet another comment that ignores the obvious introduction of the R2 and R3. When you start a new auto manufacturing company you don’t lead with the low margin mass market vehicles. You build the halo cars to build excitement and brand cachet.

You’re the one not seeing clearly, as the total strategy has been out for years now.

 

[DuoRivian]

I think we also need to mention this demand constraint is normal and expected in the price point the R1 plays in. In fact the R1 series is in demand among other vehicles in the category.

Completely agree that this is to be expected. Does make me wonder how Scout will fill their half of the 200k factory they are building, especially with their positioning as an even more hardcore off road (at the expense of on road behavior) brand.

 

[mkg3]

Completely agree that this is to be expected. Does make me wonder how Scout will fill their half of the 200k factory they are building, especially with their positioning as an even more hardcore off road (at the expense of on road behavior) brand.

Recall reading that when VWG announced the South Carolina factory for Scout, they will also produce Audi SUVs there too.

 

[DuoRivian]

Recall reading that when VWG announced the South Carolina factory for Scout, they will also produce Audi SUVs there too.

Yes Audi has 100k and Scout has 100k which will be hard for Scout to fill given Rivian has topped out at around 40k R1s.

 

[Gentilly7]

Tesla sold an average of 25k Model S sedans leading up to the Model 3 launch

That was good numbers for a large 4 door sedan priced in the luxury class. Tesla was good at reducing options to streamline production and reduce cost.

Rivian seems to be doing the opposite. More battery, drivetrain and interior options. They keep wanting to push the average price of the R1 higher to help their margins. But it’s reducing their sales volume as the number of people willing to pay that kind of money for a midsize SUV, from a fairly new car company with less than stellar service turnaround time, is really low. And this is coming from someone that’s currently in the process of purchasing an R1S.

They are sitting on a factory with current capacity to produce 150k vehicles a year, but they can barely build 50k between 3 models combined. Thats got to hurt.

Toyota/Lexus/GM/Ford/Land Rover all sell plenty of medium/large SUVs in the $70k- $90k range. I cross shopped them all. Rivian needs to have a more compelling product in that price range.

They should be learning how to find the optimal balance of price and options with the R1 range. The R2 is not going to save them if they don’t.

 

[Donald Stanfield]

Tesla sold an average of 25k Model S sedans leading up to the Model 3 launch

That was good numbers for a large 4 door sedan priced in the luxury class. Tesla was good at reducing options to streamline production and reduce cost.

Rivian seems to be doing the opposite. More battery, drivetrain and interior options. They keep wanting to push the average price of the R1 higher to help their margins. But it’s reducing their sales volume as the number of people willing to pay that kind of money for a midsize SUV, from a fairly new car company with less than stellar service turnaround time, is really low. And this is coming from someone that’s currently in the process of purchasing an R1S.

They are sitting on a factory with current capacity to produce 150k vehicles a year, but they can barely build 50k between 3 models combined. Thats got to hurt.

Toyota/Lexus/GM/Ford/Land Rover all sell plenty of medium/large SUVs in the $70k- $90k range. I cross shopped them all. Rivian needs to have a more compelling product in that price range.

They should be learning how to find the optimal balance of price and options with the R1 range. The R2 is not going to save them if they don’t.

Rivian starts in the 70’s now. They have a vehicle in that price range.

 

[Gentilly7]

Rivian starts in the 70’s now. They have a vehicle in that price range.

My statement said Rivian needs a “more compelling product” in that price range.

 

[Donald Stanfield]

My statement said Rivian needs a “more compelling product” in that price range.

Either you want one, or you don't. Their product is compelling enough at that price range and needs differentiation from their higher margin models.

 

[Gentilly7]

Either you want one, or you don't. Their product is compelling enough at that price range and needs differentiation from their higher margin models.

Well Donald, that can be said about any vehicle. But the point is, too many people are choosing not to get one. Hence, Rivian’s lower guidance.

 

[Zoidz]

My statement said Rivian needs a “more compelling product” in that price range.

Either you want one, or you don't. Their product is compelling enough at that price range and needs differentiation from their higher margin models.

Well Donald, that can be said about any vehicle. But the point is, too many people are choosing not to get one. Hence, Rivian’s lower guidance.

It can be said about any vehicle, yes. "Compelling product" is highly subjective based on the consumer. Rivian is not trying to be everything to everybody all at once, nor should they. In the automotive industry as well as many others, that's impossible for a startup.

 

[Gentilly7]

It can be said about any vehicle, yes. "Compelling product" is highly subjective based on the consumer. Rivian is not trying to be everything to everybody all at once, nor should they. In the automotive industry as well as many others, that's impossible for a startup.

Being “everything to everybody all at once” is a far cry from making a few adjustments to sell a little more than 50k/year across three vehicles. Wall Street was only expecting 55k vehicles and Rivian is guiding below that. It’s the main reason the stock is taking a hit right now.

 

[Donald Stanfield]

Well Donald, that can be said about any vehicle. But the point is, too many people are choosing not to get one. Hence, Rivian’s lower guidance.

Even at their lower guidance they are selling a decent amount of vehicles at that price point. The simple fact is the market for 70k+ cars is small. Everyone knows that, yet are surprised by this.

You’re acting like their guidance went to 50 cars this year when it’s not too far from last year. With an administration hostile to EVs that will probably remove the tax incentives a lower guidance is realistic, and will be the same for every EV manufacturer.

The R1 was never intended to be the demand driver for the brand and the 150k unit capacity is the factory production limit not the intended manufacturing target.

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