There is one small problem in this assumption. There has to be buyers at the higher prices for the R1 vehicles. Currently there are newer high end EVs and Rivian will not be able to sell at the prices you state. They will just sit as inventory and will require carrying costs for Rivian's books.
Not sure what number are looked and yet until R2 was released the R1 was carrying the full administrative and factory burden. Those costs can now be shared. Need to know the true variable cost to build R1 before declaring no money is made.
What about applying what they learned from the R2 to the R1? They could have a Standard Model that has a more traditional suspension that’s more affordable and easier to repair, use a structural battery pack with 4695 cells, and offer a more affordable interior. Of course adding the rear drop glass would add expense, but that could be reserved for the higher-end R1 trims, just like the R2. I don’t see any of this happening for a few years though. They have to concentrate on the R2, the R3, and getting the Georgia Plant up and running.
You know that the metric of Rivian losing 23K per car sold doesn't actually mean the cars are produced at a loss, right? That loss is Rivian's total operating costs, averaged per vehicle sold. That means all their service center and corporate employee costs are applied to those cars. If Rivian sells more cars, that loss per car would reduce, not increase, which is what's implied by the "Loss on each vehicle" statement.
They will price themselves right out of the market if they try and charge nearly $140k for a R1 tri/quad. It’s simply not built well enough or at a quality point to be worth anything close to that. At the current prices it’s very questionable and only slightly justifiable because there are so few comparable alternatives.
The electric G wagon is $186k and sells like hot cakes here. Its slower, less range and no 3rd row. Lots of people will still buy a R1 QM even at $160k. Rivian is forced with profitability dilemma and must make money on every car they sell. Losing $30k per unit is no longer acceptable to shareholders and the market.
Actually the $23k is. If you add all depreciation including factory and R&D it is $37k. It’s well documented that the actual production cost per R1 is Negative.
100%. I love my Gen 2 Tri, but I still cringe at some of the cost-cutting measures. The doors feel cheap/hollow, door handles and window switches feel cheap, there's no dual-pane front glass, and then there's the audio system, which honestly sounds like something you'd expect in a $20k vehicle.
Wrong. The actual profit vs production cost is positive. Not only has this been true for over a year, and the entire point of the Gen 2 vehicles, but it's easily verifiable with Rivian's own published numbers. Their loss has gone down despite selling more vehicles. If it was, as you said, the more vehicles Rivian sold, the bigger their loss would be.
