2021 Q3 Rivian Shareholder Letter – December 16, 2021. 71K Preorders Received

[Jarico75]

I think you're getting too caught up in grammar. They are clearly preparing for drives in Denver if you've seen that thread. Every time a service center opens they will start the mobile drives, that's the entire point of opening the center right now until deliveries start. There is no service to be done. What else would those people be doing every day?

Please don't take my comment as there will be no First Drive/Test Drive event in Denver. It was solely a response to someone claiming that facts are being misstated. I hope they do see an event in the near future.

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[Trandall]

Do we have any idea of the breakout in preorders between R1T and R1S?

Also, regarding folks’ predictions about 2022 production, would that be total vehicles or just one category?

My preorder number is roughly 45,000. If Rivian may only make 15,000 vehicles in 2022 I have years to go. But if it’s 15,000 of each, I’ll be much closer to reception.

By you preorder # we can conclude your preorder date, Which would be sometime in late summer 2020, but not your delivery window. Is your configuration a LE? it is estimated their are in the ballpark of 10K LE orders and they have had delivery windows completed by I think August 2021 if LE R1S. If you are not a LE customer Rivian has stated they will give delivery timing in the next few weeks. So remember an order # of 45,000 does not mean your will be the 45,000th vehicle off the line.

 

[mkg3]

That's not correct, I listened the first time and just re-listened. The question referred to the S1 which said that current preorder backlog would be fulfilled by "end of fiscal 2023" and asked him if he would still reiterate that guidance, which he did. RJ misspoke and said by 2023 but he meant end of 2023.

Wow thee have been lots of posts since I last viewed the thread.

The Jonas reference was used to frame the question about the next year's production rate and by the end of 2023 but his response was by 2023.

I guess you hear what you want to hear - myself included, I suppose. You and others attribute his comment as "misspoken and meant 2023 and 2024" and I interpreted as what he said. Financially and patience wise, RJ knows he cannot drag this out two years plus.

Since this comment is very material, if he misspoke, there are staff listening to the response to correct any errors in real time. As such, RJ had many opportunities to clarify and correct his words - which he did not.

At the end of the day, I'm sure that we all want the vehicles sooner than later so when the next set of emails indicating non-LE production window comes out, we can be glad, sad or as expected, based on how you view things today...

 

[Guy]

Wow thee have been lots of posts since I last viewed the thread.

The Jonas reference was used to frame the question about the next year's production rate and by the end of 2023 but his response was by 2023.

I guess you hear what you want to hear - myself included, I suppose. You and others attribute his comment as "misspoken and meant 2023 and 2024" and I interpreted as what he said. Financially and patience wise, RJ knows he cannot drag this out two years plus.

Since this comment is very material, if he misspoke, there are staff listening to the response to correct any errors in real time. As such, RJ had many opportunities to clarify and correct his words - which he did not.

At the end of the day, I'm sure that we all want the vehicles sooner than later so when the next set of emails indicating non-LE production window comes out, we can be glad, sad or as expected, based on how you view things today...

At least we find out soon when people like me who ordered in October 2021 get their email and see if it is early, mid or late 2023.

 

[kurtlikevonnegut]

At least we find out soon when people like me who ordered in October 2021 get their email and see if it is early, mid or late 2023.

I'll be interested to see when the cutoff is for preorder date to get one in 2022. I put my order in when I did because i anticipated demand would skyrocket after the MT series and I was correct. The question is whether I pulled the trigger soon enough.

 

[Dbeglor]

You need to go back and read more carefully. I'm talking about specific events we've seen, like Elon designing the Cybertruck on the fly. He did the same thing with early Tesla models. If this is how he randomizes his product plans, then it's my speculation that this contributes massively to "Hell."

My contention is simply that just because Tesla took a decade to get their act together, doesn't mean Rivian will have to go through the same thing. We're both speculating either way. I just base my speculation on what I've seen Rivian do, what I know about how Amazon handles their business ventures, and the quality of the product that is now going out the door.

I read it just fine. My point is that production of anything for the first time is hell by default, regardless of planning or competence because you don't know what you don't know. That was true for Tesla for their own unique reasons, any number of which could include what you are suggesting. It will be true for Rivian for a completely different set of unforeseen reasons, exacerbated by the current supply chain chaos. I fully believe they will figure it out and be successful, just like Tesla worked through it.

Rivian will not take anywhere near a decade to achieve what it took Tesla the same amount of time to, but that's not a reflection of Tesla. A lot of it is actually because Tesla blazed that trail when the access to capital, supply chains and demand for EVs were far from what they are today. Rivian is basically where Tesla was in 2017, trying to mass produce a product for the first time (Model S and X were never mass produced before then, and I'd argue still aren't really mass produced at roughly less than 25k each). They will learn a ton in the next two years, and we'll all be better off for it.

 

[ChrissyOne]

Rivian will not take anywhere near a decade to achieve what it took Tesla the same amount of time to, but that's not a reflection of Tesla. A lot of it is actually because Tesla blazed that trail when the access to capital, supply chains and demand for EVs were far from what they are today. Rivian is basically where Tesla was in 2017, trying to mass produce a product for the first time (Model S and X were never mass produced before then, and I'd argue still aren't really mass produced at roughly less than 25k each). They will learn a ton in the next two years, and we'll all be better off for it.

100% agree.

 

[Dbeglor]

Wow thee have been lots of posts since I last viewed the thread.

The Jonas reference was used to frame the question about the next year's production rate and by the end of 2023 but his response was by 2023.

I guess you hear what you want to hear - myself included, I suppose. You and others attribute his comment as "misspoken and meant 2023 and 2024" and I interpreted as what he said. Financially and patience wise, RJ knows he cannot drag this out two years plus.

Since this comment is very material, if he misspoke, there are staff listening to the response to correct any errors in real time. As such, RJ had many opportunities to clarify and correct his words - which he did not.

At the end of the day, I'm sure that we all want the vehicles sooner than later so when the next set of emails indicating non-LE production window comes out, we can be glad, sad or as expected, based on how you view things today...

I'm looking at the totality of facts, including the context of the question in which the answer was given, and the reaction to the answer. The reports from the call have referred to it with the same interpretation as me, that he misspoke. It would make zero sense that they would put in the S1 a month ago that it would take through 2023 to get through 55k vehicles, then yesterday claim they can do 71k in 2022. If that were the case, we surely would not have seen the selloff in the market that we did, it would have gone up 15%. Most of the call was spent assuring that the recent/immediate slowdowns would not affect the original long term production expectations laid out in the S1.

Either way, we'll find out soon when they send out production guidance.

 

[Blur1t]

I'm looking at the totality of facts, including the context of the question in which the answer was given, and the reaction to the answer. The reports from the call have referred to it with the same interpretation as me, that he misspoke. It would make zero sense that they would put in the S1 a month ago that it would take through 2023 to get through 55k vehicles, then yesterday claim they can do 71k in 2022. If that were the case, we surely would not have seen the selloff in the market that we did, it would have gone up 15%. Most of the call was spent assuring that the recent/immediate slowdowns would not affect the original long term production expectations laid out in the S1.

Either way, we'll find out soon when they send out production guidance.

Yes I’m curious we’re the t max pack timeline will fall through all of this. My guess 2023.

 

[mkg3]

I'm looking at the totality of facts, including the context of the question in which the answer was given, and the reaction to the answer. The reports from the call have referred to it with the same interpretation as me, that he misspoke. It would make zero sense that they would put in the S1 a month ago that it would take through 2023 to get through 55k vehicles, then yesterday claim they can do 71k in 2022. If that were the case, we surely would not have seen the selloff in the market that we did, it would have gone up 15%. Most of the call was spent assuring that the recent/immediate slowdowns would not affect the original long term production expectations laid out in the S1.

Either way, we'll find out soon when they send out production guidance.

I really like the fact that you are so sure of what Rivian is going to do.

Do you work for them or have a close relationship that gives you such an authoritative response?

I did not read or hear a single report discussing next year's production numbers. ALL the talking heads and reports pointed to the fact that they missed 2021 production by few hundred vehicles due to supply shortages being the reason for the downward hit today. Also the CapEx for GA plant.

When they filed S1, the metric they had was something like 3.2 R1T/day and since then the metric increased to somewhere near 10.5/day, saying that it has much improved in a short period (this was quoted in an interview with RJ but I cannot recall which source it was. I would cite it if I could recall it.).

I realize even at this pace, they need to increase an order of magnitude times two to achieve anything close to 50K/yr based on a single shift 5 days/wk schedule.

My point is that looking backwards to forecast the future has value as long as the assumptions are still valid. But when the assumptions change, forecasting future outcome using history is not very accurate.

 

[Rivian_Hugh_III]

By you preorder # we can conclude your preorder date, Which would be sometime in late summer 2020, but not your delivery window. Is your configuration a LE? it is estimated their are in the ballpark of 10K LE orders and they have had delivery windows completed by I think August 2021 if LE R1S. If you are not a LE customer Rivian has stated they will give delivery timing in the next few weeks. So remember an order # of 45,000 does not mean your will be the 45,000th vehicle off the line.

Thanks for this and for Guy’s reply. I indeed ordered in late summer — around Sept 20th or so. At that time LE’s were no longer offered, much to my chagrin.

I’m assuming a delivery date of December 2022 - June 2023. I’m okay with that as I figure I’ll get a few second-gen upgrades and I can stock the piggy bank for a nice down payment.

Who above said they got a job with Rivian this week? I live in Southeast Michigan and all the jobs in Detroit and Plymouth appear to be engineering. My expertise is HR. I feel like there must be some HR system in place in Plymouth, but no jobs posted for ages.

Btw, on the way home from the hardware store yesterday a white Rivian passed right in front of my eyes as I sat at a stop sign. Wow, what a creature of beauty. The shape from every angle is so distinct. It’s unlike anything I’ve ever seen. Sleek, muscular, clean lines, silent running. It took all I had to not follow it towards the horizon.

 

[Zoidz]

My point is that production of anything for the first time is hell by default, regardless of planning or competence because you don't know what you don't know.

This is the most ridiculous thing I have read in this thread. I have 30+ years of automated production line design, engineering, commissioning and startup under my belt. Many of the startups went just fine and there was no hell. The first time producing anything is not hell by default, ESPECIALLY when planning and competence is spot on.

 

[crashmtb]

My point is that production of anything for the first time is hell by default, regardless of planning or competence because you don't know what you don't know.

this is categorically false.

 

[Eticket99]

Yes, long term strategy, build another plant etc etc etc..... But, you can't even get 1-plant efficiently up and running at capacity and every turn for the past year you've been behind/late. I've read people posting about adaptability but they clearly aren't adapting effeciently enough as they get further behind. For a company that complains and makes excuses of lack of manpower and resources blah blah blah.... What do you think adding a new $5B plant is going to do for current employees in the next 12-18 months? It surely won't help get their Normal plant up to 200k cars a year production capacity any sooner and I'd argue further hinder that process by diluting current efforts.

 

[Whmorken]

Yes, long term strategy, build another plant etc etc etc..... But, you can't even get 1-plant efficiently up and running at capacity and every turn for the past year you've been behind/late. I've read people posting about adaptability but they clearly aren't adapting effeciently enough as they get further behind. For a company that complains and makes excuses of lack of manpower and resources blah blah blah.... What do you think adding a new $5B plant is going to do for current employees in the next 12-18 months? It surely won't help get their Normal plant up to 200k cars a year production capacity any sooner and I'd argue further hinder that process by diluting current efforts.

They may have no choice but to win a two front war. I can think of reasons…

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