? RJ's Letter -- Making it Right -- REVERSING THE PRICE CHANGE FOR PREORDER HOLDERS

[kbaybob]

Hello Everyone, Earlier this week, we announced pricing increases that broke the trust we have worked to build with you. Since originally setting our pricing structure, and most especially in recent months, a lot has changed. The costs of the components and materials that go into building our vehicles have risen considerably. Everything from semiconductors to sheet metal to seats has become more expensive and with this we have seen average new vehicle pricing across the U.S. rise more than 30% since 2018. Given our build lead up times, we need to plan production costs not only for today, but also for the future. As we worked to update pricing to reflect these cost increases, we wrongly decided to make these changes apply to all future deliveries, including pre-existing configured preorders. We failed to appreciate how you viewed your configuration as price locked, and we wrongly assumed the announced Dual-Motor and Standard battery pack would provide configurations that would deliver price points similar to your original configuration. While this was the logic, it was wrong and we broke your trust in Rivian. We also didn’t manage communications well. We didn’t give you enough insight into what was driving these decisions. The most important aspect of what we are building is our relationship with all of you. As we demonstrated earlier this week, trust is hard to build and easy to break. In speaking with many of you over the last two days, I fully realize and acknowledge how upset many of you felt. I have made a lot of mistakes since starting Rivian more than 12 years ago, but this one has been the most painful. I am truly sorry and committed to rebuilding your trust. One of the things we talk about a lot internally is that we will make mistakes – it’s part of building something complex. The key is to learn from them and address them when they are made. It is how we grow. We made a mistake in how we approached our pricing changes, and what is important now is that we fix it. For anyone with a Rivian preorder as of the March 1 pricing announcement, your original configured price will be honored. If you canceled your preorder on or after March 1 and would like to reinstate it, we will restore your original configuration, pricing and delivery timing. Our team will be sending an email in the next few days with more details. Regarding our updated pricing for future preorders, the introduction of our Dual-Motor configuration and Standard battery pack has been designed to enable us to maintain lower starting prices while adjusting the pricing of the Quad-Motor and larger battery packs to reflect rising costs. Building a durable business is core to the continued impact we can deliver as a company. We are focused on building a brand and products that will continue to scale to different vehicle sizes, use cases, price points and markets – this growth will only be possible with your support and continued feedback. Thank you for the personal notes and discussions I had with so many of you. Your feedback makes us better. RJ​

Thank you! I was fairly confident that the blowback would lead you to this conclusion, and I hope my email played a small part. It was the right decision, and we all appreciate it.
Bob

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[SANZC02]

Is all about pricing. Even Ford/Chevy did this a long time ago, and dropped the option for 3rd row seat removal. It saves them on tooling as the no longer need 2 floor pans, as one fills the need, and the 3 row has a few more weld points. Time and money, and they can upcharge the customer to save them time and money, its a win/win for the OEM.

The only thing I have not heard on the Rivian, is that the 3rd row seat on the Chevy/Ford are removeable by the consumer, are they going to be the same?

Unless they changed something when I asked awhile ago they were not removable.

Of course we know everything really is “removable” but they are not designed to be taken out.

 

[iansriv]

I think it is an efficiency decision. Probably order rate for 5 seats were well below 7, if they have fewer configurations to build and fewer part numbers they can reduce cost in some material and line performance.

I agree I do not need the 7 seater either but getting and LE had no choice. In reality if I ever want to sell down the road it probably opens up the buyer pool having it.

What is the configuration difference? I would have preferred 5 seats. Will feel more like a minivan now. Just wondering the space lost etc.

 

[87Ducks]

I haven't dug through all 27 pages of comments, but does anyone know when the price for on the configuration on the website will be updated? Mine still shows the higher price from earlier this week.

 

[RWerksman]

I haven't dug through all 27 pages of comments, but does anyone know when the price for on the configuration on the website will be updated? Mine still shows the higher price from earlier this week.

A few days.

 

[LaunchGreen]

I wasn't disagreeing with you, I was just adding my experience. I've always had positive interactions with RJ. A snippet from my email...

"I had a chance to meet you at the Atlanta event for pre-orders back in 2019. You took time with every person that wanted to chat and we had an opportunity to talk about the R1S I had preordered as well as the fact that we both have Pacifica Hybrids to shuttle our kids around, the pain of fitting car seats in a car, the impact of our decisions on our kids. I walked away from that encounter just as inspired by your accessibility, optimism, perspective, and seeming earnest desire to do good as I was by the product."

Not to burst your bubble, but almost certainly will be his PA.

 

[Napoleon Blownaparte]

I am curious regarding the 7 seat configuration. To all those wanting a 5 seater. If the 7 seater's rear seats are foldable, why the concern in getting it over the 5 seater? Last I check there wasn't a price difference between the two and space will be the same.

I think the space along the bottom/floor of the trunk is different. The 7-seat option has the interior sidewall of the vehicle pushed inward to form an armrest for the people using it, and it carries down to the floor. This means that, while volume is pretty close to the same, you now have a narrower entrance to the trunk at floor level - not great if you're trying to load large items that may be slightly wider than that at the base

I want the 5-seat. I have zero use for the additional seat and I don't want it. If it can be removed completely and there is literally no other difference between the two vehicles, then I'll still probably purchase my R1S. If, however, it either can't be removed, or there's a change in the floor/side design and layout like I described, then I'll probably cancel. I ordered the R1S and specifically the 5-seat because I wanted a ton of open covered space. If I'm paying this much for a vehicle, and it's really (pre-increase) kind of at the edge of what I'm willing to spend, I want to get what I originally wanted, not what they now want to make available.

Probably seems stupid to some, but that's why, for me. I don't want it and I don't want a vehicle that has it. If I'm being made to get something configured in a way I don't really like, then I can get that for cheaper, elsewhere.

 

[87Ducks]

A few days.

Thanks

 

[Whmorken]

I actually did send RJ an email this morning thanking him for reversing course. And surprise of surprises... he responded. It was brief, but polite, and addressed a couple of the specific points I brought up which showed me that he read it. I'm beyond surprised.

Amazing but consistent with my brief conversation with him in person. ?

 

[Deacon]

Hello Everyone, Earlier this week, we announced pricing increases that broke the trust we have worked to build with you. Since originally setting our pricing structure, and most especially in recent months, a lot has changed. The costs of the components and materials that go into building our vehicles have risen considerably. Everything from semiconductors to sheet metal to seats has become more expensive and with this we have seen average new vehicle pricing across the U.S. rise more than 30% since 2018. Given our build lead up times, we need to plan production costs not only for today, but also for the future. As we worked to update pricing to reflect these cost increases, we wrongly decided to make these changes apply to all future deliveries, including pre-existing configured preorders. We failed to appreciate how you viewed your configuration as price locked, and we wrongly assumed the announced Dual-Motor and Standard battery pack would provide configurations that would deliver price points similar to your original configuration. While this was the logic, it was wrong and we broke your trust in Rivian. We also didn’t manage communications well. We didn’t give you enough insight into what was driving these decisions. The most important aspect of what we are building is our relationship with all of you. As we demonstrated earlier this week, trust is hard to build and easy to break. In speaking with many of you over the last two days, I fully realize and acknowledge how upset many of you felt. I have made a lot of mistakes since starting Rivian more than 12 years ago, but this one has been the most painful. I am truly sorry and committed to rebuilding your trust. One of the things we talk about a lot internally is that we will make mistakes – it’s part of building something complex. The key is to learn from them and address them when they are made. It is how we grow. We made a mistake in how we approached our pricing changes, and what is important now is that we fix it. For anyone with a Rivian preorder as of the March 1 pricing announcement, your original configured price will be honored. If you canceled your preorder on or after March 1 and would like to reinstate it, we will restore your original configuration, pricing and delivery timing. Our team will be sending an email in the next few days with more details. Regarding our updated pricing for future preorders, the introduction of our Dual-Motor configuration and Standard battery pack has been designed to enable us to maintain lower starting prices while adjusting the pricing of the Quad-Motor and larger battery packs to reflect rising costs. Building a durable business is core to the continued impact we can deliver as a company. We are focused on building a brand and products that will continue to scale to different vehicle sizes, use cases, price points and markets – this growth will only be possible with your support and continued feedback. Thank you for the personal notes and discussions I had with so many of you. Your feedback makes us better. RJ​

Thanks RJ. I just jumped off the fence - I'm all in now!

 

[IronM5]

I cancelled my order a few minutes before I saw this anouncement. Then received the email an hour after that. It's been a crazy two days in Rivianland! Need to decide what to do now. Have some mixed feelings

 

[7cupholders]

Damn, a great response. I was so ready to be done and did cancel. I’m tentatively back on board. Financially it would be ridiculous not be. I’m still disheartened a lot, but this may have ended up being a good thing overall. I hope they communicate better and listen to the community that at least RJ sounds like he actually wants the community. I want to make sure he surrounds himself with folks who believe in it too. I’ll hang on for now, but Rivian has a lot of promises to live up to.

For the folks who said what ever I’ll pay 25% and like it, please reassess your priorities. It’s awesome that the preorder community called out a incredibly huge misstep and that Rivian responded. Your fanboying before even having the product is embarrassing, be a healthy fan. I’ll gush over the truck again once Rivian proves itself and I have a truck in my garage.

 

[Guy]

I think the space along the bottom/floor of the trunk is different. The 7-seat option has the interior sidewall of the vehicle pushed inward to form an armrest for the people using it, and it carries down to the floor. This means that, while volume is pretty close to the same, you now have a narrower entrance to the trunk at floor level - not great if you're trying to load large items that may be slightly wider than that at the base

I want the 5-seat. I have zero use for the additional seat and I don't want it. If it can be removed completely and there is literally no other difference between the two vehicles, then I'll still probably purchase my R1S. If, however, it either can't be removed, or there's a change in the floor/side design and layout like I described, then I'll probably cancel. I ordered the R1S and specifically the 5-seat because I wanted a ton of open covered space. If I'm paying this much for a vehicle, and it's really (pre-increase) kind of at the edge of what I'm willing to spend, I want to get what I originally wanted, not what they now want to make available.

Probably seems stupid to some, but that's why, for me. I don't want it and I don't want a vehicle that has it. If I'm being made to get something configured in a way I don't really like, then I can get that for cheaper, elsewhere.

Please cancel,very few people who buy a three row SUV want just five seats. That could be why vehicles like the CX9, Telluride, Highlander are all three row with no option to delete seats. Deal with it (quietly please) as you are in a very small minority who want this - it adds build complexity for virtually no gain to Rivian.

 

[LaunchGreen]

Damn, a great response. I was so ready to be done and did cancel. I’m tentatively back on board. Financially it would be ridiculous not be. I’m still disheartened a lot, but this may have ended up being a good thing overall. I hope they communicate better and listen to the community that at least RJ sounds like he actually wants the community. I want to make sure he surrounds himself with folks who believe in it too. I’ll hang on for now, but Rivian has a lot of promises to live up to.

For the folks who said what ever I’ll pay 25% and like it, please reassess your priorities. It’s awesome that the preorder community called out a incredibly huge misstep and that Rivian responded. Your fanboying before even having the product is embarrassing, be a healthy fan. I’ll gush over the truck again once Rivian proves itself and I have a truck in my garage.

Who said " I’ll pay 25% and like it" exactly? I only read like 80 pages but I didn't see that.

 

[Friscorays]

I don't know if the management here likes us posting direct links to Rivian Stories content but they have released a video responding to the price change change .

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