Please help me understand

[TheWebMedic]

I’m having a hard time understanding why is a manufacturer they don’t just open the configurator to everyone so they could then get a true understanding of what needs to be built I don’t see the reasoning behind only getting a few at a time. I’m a salesforce developer, and for me forecasting is one of the most valuable tools you can use so the fact that they’re not wanting to foresee what their true forecast is has me a bit puzzled.

Please understand I’ve never pre-ordered a car or been on a waiting list so this is all new to me but just as a basic sales function I’m just a little confused why they wouldn’t want to know what their true pipeline was. Thank you in advance.

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[mkg3]

isn't what this is?

https://rivian.com/configurations/builder/r2

The wording may be what's confusing more than anything. Rivian is letting the reservation holders convert to purchases from the Launch Edition configuration with simple small option list and color choice. They have priority scheme that they are using to let those people know as the inventory allows - for now....

 

[VSG]

I’m having a hard time understanding why is a manufacturer they don’t just open the configurator to everyone so they could then get a true understanding of what needs to be built

That's what they did for the R1 launch. And it caused all sorts of problems and actually made production planning MORE difficult.

So they decided to do it differently this time. They are offering only a limited number of options while they ramp up production - this doesn't require forecasting, as all are going to be sold, and will be far more efficient in the early days than trying to make each vehicle to order for a specific customer. And BTW they *are* collecting data, through the saved configurations in your Rivian account. I suspect that's why the timeline for Coastal Cloud, Borealis, and Forest Green production was changed - Rivian saw those were more desired than they thought.

We don't know the details of how they're operating the configuration and purchase process yet, and it is subject to change (and it *will* change over the next 6 months as production increases), so we're just going to have to wait and see how it works.

 

[CharonPDX]

Hardware is not software.

Actual real physical things have to be ordered and delivered and assembled. Minimizing the number of variables early on allows them to concentrate on achieving volume deliveries early.

Once the "rush of people whose needs and wants fit the early limited selection of choices" slows down, they will open up more options. But as long as there is very high demand for the limited set of options, why bother opening up more choices and complicating manufacturing early?

 

[ribuck97]

Think of it in the simple case:

Lets produce the first 25k vehicles all with:

Black Crater Signature interior​

Tow hitch​

Dual Motor AWD​

Active Dampers​

Rear Window​

​

You have now eliminated 7 variables on the possible configurations and cut it down to ONLY 2: Paint and wheels.

You have a narrow supply chain and a very streamlined production line which also may or may not be the highest profit margin configuration.

 

[emroch]

It also allows them to provide more accurate delivery estimates for the orders that are placed. If they opened the flood gates, they would have to make some initial guess based on very little data, and hope that they don't have to slip those estimates as more orders come in. If they didn't have a priority queue for reservation holders, this might not be the end of the world, but there are still reasons they wouldn't want to keep switching the production line between configs as the order mix changes.

 

[UnsungZero_OldTimeAdMan]

Think of it in the simple case:

Lets produce the first 25k vehicles all with:

Black Crater Signature interior​

Tow hitch​

Dual Motor AWD​

Active Dampers​

Rear Window​

​

You have now eliminated 7 variables on the possible configurations and cut it down to ONLY 2: Paint and wheels.

You have a narrow supply chain and a very streamlined production line which also may or may not be the highest profit margin configuration.

And fewer mistakes to make. Production mistakes are not cheap. Avoiding costly mistakes is important for any company in a make or break state—just 4 years in from first delivery of first consumer product. If you owned a relatively new business at similar stage, you’d be dumb to YOLO and bet the whole farm by going hog wild with expansion plans. You do not overpromise to set yourself up for failure. It’s not brain surgery. You just have to think what you would do if it was your business that you’re trying to build and grow, what pitfalls you would avoid, so that the business is sustainable and profitable in the long run, without overextending and going bust in the short and mid-term. Conservative business decisions are easier to imagine and understand if yourself is at risk.

 

[ribuck97]

And fewer mistakes to make. Production mistakes are not cheap. Avoiding costly mistakes is important for any company in a make or break state—just 4 years in from first delivery of first consumer product. If you owned a relatively new business at similar stage, you’d be dumb to YOLO and bet the whole farm by going hog wild with expansion plans. You do not overpromise to set yourself up for failure. It’s not brain surgery. You just have to think what you would do if it was your business that you’re trying to build and grow, what pitfalls you would avoid, so that the business is sustainable and profitable in the long run, without overextending and going bust in the short and mid-term. Conservative business decisions are easier to imagine and understand if yourself is at risk.

From MotorTrend:

“The Rivian team’s thinking about product has changed dramatically since it launched the R1T, R1S, and RCV, as Scaringe puts it, “within the same three-month period, and in the middle of COVID, and then into a supply chain crisis. It was impossibly hard, and we were digging ourselves out of all the complexity we inserted instantly.”

That experience has informed the current product cadence, which will see the R2 roll out with limited options and manufacturing complexity through the summer of 2027. “The version of me from seven years ago would have been launching R2, R3, and R3X all at the same time because I love product and want to see them all as fast as possible”

Imagine if they had built a more standard active dampered suspension like the R2 in the R1 and floated the concept of RAD back then to develop a RAD tuned hydraulic anti-roll +air suspension to fit into the vehicles R1, R2, R3…

 

[Dark-Fx]

I’m having a hard time understanding why is a manufacturer they don’t just open the configurator to everyone so they could then get a true understanding of what needs to be built I don’t see the reasoning behind only getting a few at a time. I’m a salesforce developer, and for me forecasting is one of the most valuable tools you can use so the fact that they’re not wanting to foresee what their true forecast is has me a bit puzzled.

Please understand I’ve never pre-ordered a car or been on a waiting list so this is all new to me but just as a basic sales function I’m just a little confused why they wouldn’t want to know what their true pipeline was. Thank you in advance.

A configuration isn't a sale. You're not talking about napkins here, cars are expensive. It was a pretty common theme to hear people buying an R1 say it was their first new car and the most money they have ever spent on a vehicle. Will still be true for a lot of R2 buyers

 

[UnsungZero_OldTimeAdMan]

From MotorTrend:

“The Rivian team’s thinking about product has changed dramatically since it launched the R1T, R1S, and RCV, as Scaringe puts it, “within the same three-month period, and in the middle of COVID, and then into a supply chain crisis. It was impossibly hard, and we were digging ourselves out of all the complexity we inserted instantly.”

That experience has informed the current product cadence, which will see the R2 roll out with limited options and manufacturing complexity through the summer of 2027. “The version of me from seven years ago would have been launching R2, R3, and R3X all at the same time because I love product and want to see them all as fast as possible”

Imagine if they had built a more standard active dampered suspension like the R2 in the R1 and floated the concept of RAD back then to develop a RAD tuned hydraulic anti-roll +air suspension to fit into the vehicles R1, R2, R3…

And imagine how a de-contented R1 would devalue the flagship line of a brand, along with brand equity. Imagine a cheapened MB S-Class, or BMW 7 & X7. Honestly it’s crazy how some people still don’t understand that halo models are not meant to be profit centers of any brand, some 6 years since the brand said “hello”.

This is not a something for everyone, at every single price point brand. This is not Toyota. That’s done by multiple brands and Rivian would be dumb to be yet another me too. It is smartly and steadily craving out a space for itself.

 

[ribuck97]

And imagine how a de-contented R1 would devalue the flagship line of a brand, along with brand equity. Imagine a cheapened MB S-Class, or BMW 7 & X7. Honestly it’s crazy how some people still don’t understand that halo models are not meant to be profit centers of any brand, some 6 years since the brand said “hello”.

This is not a something for everyone, at every single price point brand. This is not Toyota.

In the quote it was RJ that talked specifically about ‘digging out of all of the self-inserted complexity….

Hmmmm

Oh and your analogy to MB, BMW, etc doesn’t makes sense because those vehicles weren’t even close to the first vehicles ever produced by the companIes.

I love the R1’s as there was, and still is, really nothing like them… But did Rivian need to produce them to that level of complexity to have them be a “flagship”? The Model S air suspension wasn’t standard…

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