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

[Blackhatch]

I can't read 32 pages of comments. Anyone got the cliff notes?

They raised the prices...people had a shit fit...they honored the original prices?

Is that where we are currently?

And doe the Adventure package still include the Tonneau cover?

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[mgc0216]

I can't read 32 pages of comments. Anyone got the cliff notes?

They raised the prices...people had a shit fit...they honored the original prices?

Is that where we are currently?

And doe the Adventure package still include the Tonneau cover?

And people being panicked that old pricing isn't yet reflected in the configurator despite the mea culpa email clearly saying "give us a few days to sort this stuff out"

And "what are they going to do w/ the underbody shield - will that be mandatory when they roll back prices or can I get an LE w/o it and save $2,000"

 

[Scoiatael]

I can't read 32 pages of comments. Anyone got the cliff notes?

They raised the prices...people had a shit fit...they honored the original prices?

Is that where we are currently?

And doe the Adventure package still include the Tonneau cover?

They raised the prices, a ton of people canceled, and they had to walk it back. We don't know anything more than that right now. Adventure package might still need to have tonneau cover added on, we'll have to wait and see how the configurator for people who ordered before March 1st looks.

 

[stynes]

I haven't read all 32 pages (as I type this) of this thread, but am I the only one that isn't that impressed with the retraction letter? To me, it seemed like a standard "We really screwed the pooch, so we're undoing what we did." letter. It actually annoyed me a bit that it started off by not only stating the obvious (prices have risen over the 4 years) but seemed to kind of chide us for not realizing that they could legally raise the prices. The last point being completely untrue to anyone that had read any of the forums. I read that as rationalization for their error, not contrition.
I am still very happy that they did the U-turn, and did it so quickly, but it sure seemed like SOP to me. The letter was OK and I really hope that Rivian has reconsidered the value of the pre-order community and that our loyalty has limits. It was good that it came from RJ and not just Rivian, but it SHOULD have come from him personally.
I'm not criticizing the retraction (well, OK, just a little bit for the rationalization) but I don't understand why people are falling on their knees declaring this is the greatest move since Hannibal wondered "what about Pachyderms?" They screwed up, they un-did it and so I am happy to move forward with them. Albeit it slightly less happy than I was on Feb 28. I'll be evaluating their behavior in the future a bit more objectively and have put the rose-colored glasses back in the drawer.

I was sufficiently happy with the letter. It felt genuine, it felt personal. It addressed the economic realities as well as the human aspect of the whole situation that they obviously miscalculated in their decisions. I didn't personally feel chided but rather I felt it was his way of acknowledging the facts - prices have gone up - to then say, essentially "but we responded to the business reality the wrong way." I felt it was well done. My $.02.

 

[sevengroove]

And "what are they going to do w/ the underbody shield - will that be mandatory when they roll back prices or can I get an LE w/o it and save $2,000"

I'm pretty sure they made the shield optional at some point last year so we're still able to save $2k on it, but that was the only way to get tow hooks. The new pricing structure separates tow hooks out and includes it for free, while still charging $2k for the underbody shield.

 

[mgc0216]

I'm pretty sure they made the shield optional at some point last year so we're still able to save $2k on it, but that was the only way to get tow hooks. The new pricing structure separates tow hooks out and includes it for free, while still charging $2k for the underbody shield.

Right yes, that's the question now: Do we get tow hooks w/o the shield if we go back to the way we were.

 

[Rhidan]

Just a postscript from me. This was primarily a communications disaster. Rivian still doesn't understand how to communicate with customers.

Hindsight is 20/20. But I'm sure most of us on the forums could have come up with a better strategy for increasing prices.

For example, they could have just done a flat $10k increase. We could have received an email from RJ, like the second email, laying out the fact that they set prices before the pandemic, supply chain issues, and inflation. He could have said it was painful for him for those who have been on the adventure so long, but Rivian had to adjust prices. And RJ could have said, "sorry, you're all getting black mountain and the cheap tonneau due to supply constrains/costs." They could have then thrown everyone a bone like opening up all the paint choices to those who pre-ordered prior to March 1 at no extra cost.

Yes, we would have bitched about something like that and several people would have canceled. But those of us with the Rivian-disease likely would have just ate the increase and justified it as the changed circumstances from when prices were first announced.

Instead, we received a very haphazard and impersonal email announcing price increases "in process" that will impact our account, and then an extremely complicated price increase on every option that made it difficult to follow and felt like it was trying to obscure $12k-20k increases.

Now Rivian is facing the problem on both ends. Rivian will lose money on each vehicle sold, and investors will devalue the stock because Rivian cannot become profitable until it at least gets through all of pre-orders prior to March 1.

 

[gordonrands]

Wondering, if all the pre-order holders NOT cancelled moved up in line?

Nope, a chat with them indicates that all pre-order holders who cancelled will be restored to their place in line prior to cancellation.

 

[gordonrands]

My configuration price has NOT reverted back.
Instead of refreshing every 15 minutes, I am going to wait until tonight before checking again.

Customer service said it would probably take several days for everything to get reinstated. They will email us when all is done.

 

[SANZC02]

Right yes, that's the question now: Do we get tow hooks w/o the shield if we go back to the way we were.

We will have to see how things are restored but my guess is that change was made to reduce build variations streamlining the line. If that is true, they will leave the tow hooks as standard on these models so if you had the additional shields only for the tow hooks you can probably drop them.

 

[garthkoyle]

Just a postscript from me. This was primarily a communications disaster. Rivian still doesn't understand how to communicate with customers.

Hindsight is 20/20. But I'm sure most of us on the forums could have come up with a better strategy for increasing prices.

For example, they could have just done a flat $10k increase. We could have received an email from RJ, like the second email, laying out the fact that they set prices before the pandemic, supply chain issues, and inflation. He could have said it was painful for him for those who have been on the adventure so long, but Rivian had to adjust prices. And RJ could have said, "sorry, you're all getting black mountain and the cheap tonneau due to supply constrains/costs." They could have then thrown everyone a bone like opening up all the paint choices to those who pre-ordered prior to March 1 at no extra cost.

Yes, we would have bitched about something like that and several people would have canceled. But those of us with the Rivian-disease likely would have just ate the increase and justified it as the changed circumstances from when prices were first announced.

Instead, we received a very haphazard and impersonal email announcing price increases "in process" that will impact our account, and then an extremely complicated price increase on every option that made it difficult to follow and felt like it was trying to obscure $12k-20k increases.

Now Rivian is facing the problem on both ends. Rivian will lose money on each vehicle sold, and investors will devalue the stock because Rivian cannot become profitable until it at least gets through all of pre-orders prior to March 1.

While it could be interpreted that they're selling each vehicle at a loss because of rising costs, it's not quite accurate. RJ hinted at their materials inventory costs.

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.

Three things are important there:

1. The inflationary changes have been the most dramatic "in just recent months".
2. The "build lead up times" is likely much longer than a few recent months. So, they likely have a lot of materials in inventory that has already been paid for.
3. What they are seeing is a skyrocket in materials prices, and need people to plan for prices 12-24 months from now when the more expensive raw materials are used and the vehicle is sold/delivered.

I think that's why they can still sell vehicles to current reservation holders for a profit. But that's not possible in the near future.

So, I think they can be profitable with the old COGS until that runs out. Does that make sense?

 

[PAFDenver]

Right yes, that's the question now: Do we get tow hooks w/o the shield if we go back to the way we were.

Let's be fair. We shouldn't get them without the underbody shield. They weren't there before, they shouldn't be here now. Although it would be great if they offered them as a separate upgrade!

 

[Blackhatch]

They raised the prices, a ton of people canceled, and they had to walk it back. We don't know anything more than that right now. Adventure package might still need to have tonneau cover added on, we'll have to wait and see how the configurator for people who ordered before March 1st looks.

Thank you.

I guess I will wait to see what comes of the updates. Was configured before March 1.

Would love to see some dates on production. That would be great.

 

[ESTRUCK]

RIVIAN does need to be profitable to survive all the turbulence worldwide with part shortages, inflation, chip shortages etc. I did not change a thing when that increase letter was sent. The key will be if they remain competitive against all the new EV's from other manufacturers. I truly hope they can pull it off. I am willing to pay more but that also means getting my truck much faster for the price increases.

 

[Deacon]

Anyone have an idea when our configuator will revert back to our 3/1 pricing?

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