R2 plant expansion at Normal is 'Substantially Complete' says Rivian

[Yossarian]

Certainly good news. The article states that capacity is 215,000 units, but I suspect that means total capacity (R1, EDV and planned R2). Still, that would mean Rivian will be able to produce something like 150,000 R2's in Normal. I certainly hope that Rivian is able to sell that many R2's each year, but wonder if there are implications for the GA plant if sales don't quite reach that level.

Rivian's R2 Plant Expansion Is 'Substantially Complete

• Rivian's 1.1-million-square-foot factory expansion to build the R2 SUV is essentially complete, the company said on Tuesday.
• Rivian said it will start testing equipment on the new R2 line in the coming quarter.
• R2 production is on track, but Rivian now expects to lose more money this year.

Rivian on Tuesday said the sprawling factory addition that will house production of the upcoming $45,000 R2 crossover is essentially done.

"This quarter we made significant progress in R2 development and testing," the EV startup's CEO, RJ Scaringe, said in a statement. "We also substantially completed the expansion of our Normal, Illinois facility and have begun installing manufacturing equipment in preparation for our start of production."

The 1.1-million-square-foot expansion will house the body shop and general assembly operations for the R2. Once the expanded Normal, Illinois, plant is up and running, it will have a production capacity of 215,000 EVs, Rivian has said.

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[COdogman]

Definitely good news. Still going to be tough to sell that many because of the overall economic uncertainty, but all they can do is handle their business and build/ sell them…

 

[BigSkies]

I think they can get to ~150-175k units in the US.

Just picking a few other US sales figures from 2024 (ChatGPT sourced) for context:

-Model Y: 410k
-Rav4: 475k
-Jeep Grand Cherokee: 216k
-Subaru Forester: 175k
-Chevy Trax: 200k

I think the R2 can be at least as popular as the Subaru Forester, although loss of the tax credit won't help.

Maybe it could be as popular as the Model Y after a few years of growth?

My unsubstantiated suspicion is that Rivian plans to make US based R2's at Normal, and use capacity in Georgia to export R2's. Trade-war nonsense will have a lot to do with whether this pencils out.

 

[VandalSibs]

Something like that has been the plan since the R2 announcement last year - Normal will build R1, EDV & R2. Georgia will build additional R2s & R3. Whether or not the vehicles from Normal or Georgia will be slated for export is a question mark (that I believe won't be a factor for a few years).

 

[Golfer04]

Normal plant capacity has been a shrinking number since they bought it. Mitsubishi built up to 175,000 vehicles there, but this is Rivian's second expansion and they are up to 215,000. I know every vehicle doesn't build the same, but I think Rivian slows down in an effort to help QC (on top of disappointing sales numbers). A buddy of mine works at Honda and an Accord goes off the assembly line every 45 seconds. Apples & oranges, but maximizing capacity will be key to achieving profitability.

 

[Dark-Fx]

Normal plant capacity has been a shrinking number since they bought it. Mitsubishi built up to 175,000 vehicles there, but this is Rivian's second expansion and they are up to 215,000. I know every vehicle doesn't build the same, but I think Rivian slows down in an effort to help QC (on top of disappointing sales numbers). A buddy of mine works at Honda and an Accord goes off the assembly line every 45 seconds. Apples & oranges, but maximizing capacity will be key to achieving profitability.

They design the cycle time into the engineering of the vehicles. I have no idea what Rivian's target is, but projects I've worked on in the past varied from 50 to 75 seconds per operation. And I've had to break rules to meet cycle time before.

 

[Great Gatsby]

Anecdotally speaking, most people have a favorable opinion of Rivian and generally like the look. I have heard SEVERAL people talk about waiting on the R2 due to pricing and size, and given that IMO it looks better, still has an instrument cluster, more power, range, etc - I don't see how this vehicle doesn't dominate in sales, consideration it will be taking a lot of customers from the Model Y, specially with all the disdain towards Tesla right now.

 

[Donald Stanfield]

Anecdotally speaking, most people have a favorable opinion of Rivian and generally like the look. I have heard SEVERAL people talk about waiting on the R2 due to pricing and size, and given that IMO it looks better, still has an instrument cluster, more power, range, etc - I don't see how this vehicle doesn't dominate in sales, consideration it will be taking a lot of customers from the Model Y, specially with all the disdain towards Tesla right now.

When I saw the R2 in person, this was my impression. It is better in pretty much every way than the Model Y. The Interior is much more usable, has an instrument cluster, looks better, and has a decent-sized frunk.

 

[TTedP]

We're good if even half of that comes true ...

 

[Great Gatsby]

When I saw the R2 in person, this was my impression. It is better in pretty much every way than the Model Y. The Interior is much more usable, has an instrument cluster, looks better, and has a decent-sized frunk.

At the same price point that Rivian is targeting, I can't foresee how a rationale person gets a Model Y when the R2 exist. The Model Y just got refreshed too, so its not like we are comparing the R2 to an older model.

 

[BigSkies]

At the same price point that Rivian is targeting, I can't foresee how a rationale person gets a Model Y when the R2 exist. The Model Y just got refreshed too, so its not like we are comparing the R2 to an older model.

I agree. The R2 is designed to be cross-shopped against the Model Y. While the R2 compares very favorably to the Model Y, plenty of people will still choose Tesla for their own reasons.

Some of those reasons might include things indirect to the product like the maturity of the service location and proximity to a service center.

I'd guess maybe 1/3 of R2 sales will be people cross-shopping a Tesla, and 2/3 will be people that would never consider a Tesla in the first place.

 

[Donald Stanfield]

I agree. The R2 is designed to be cross-shopped against the Model Y. While the R2 compares very favorably to the Model Y, plenty of people will still choose Tesla for their own reasons.

Some of those reasons might include things indirect to the product like the maturity of the service location and proximity to a service center.

I'd guess maybe 1/3 of R2 sales will be people cross-shopping a Tesla, and 2/3 will be people that would never consider a Tesla in the first place.

It’s hard to say. I don’t think the R2 existing is going to shut Tesla down or anything and I do agree that the model Y will continue to sell for a while yet. My guess would be closer to a reverse of your ratio 2/3rds would be cross shopped and 1/3 would be never Teslas.

I say this because EVs in general aren’t super popular yet so people into those are going to look at all options. Then again the R2 might have the appeal to more ice buyers as it seems more like a “typical” SUV at that price point.

 

[baggachipz]

I think the biggest challenge for Rivian will be the price. In order to compete with the Model Y, it needs to be close in price, otherwise most people won't care. Me, I'm choosing it because I won't ever buy a Tesla again, but I also know that the average consumer is not me. I hope all this tariff and anti-green nonsense doesn't balloon the price.

 

[VandalSibs]

If you make sure to take the "include tax credit" option off on Tesla's page, you'll see that the Model Y starts at $44,990 - 10 bucks less than Rivian says the R2 will start at (and they made sure to emphasize that number was without incentives when they announced).

I'm pretty dang sure they are going to keep to that, as they have been pretty adamant in the various quarterly calls that the number hasn't changed.

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