Doug DeMuro Can't Stop Praising R2

[Gen(R3)Xer]

He mentioned something I’ve been thinking: R1S sales will fall when R2 comes out. And if Tesla’s trajectory is any indication, R1S may eventually go the way of Model X in a few years - meaning discontinued. There’s basically two factors that will keep R1S alive: 1) people who want 3 rows/7 seats and 2) Those who want to go more off-road than the R2 can handle.

For the first group, I think the R2 platform is flexible enough to shorten to make an R3, it’s probably flexible enough to stretch to make a 3 row R2. Again, it’d be like what Tesla did in China: make a longer Model Y with 3 rows.

And for the 2nd group, people who want to go even more off-road than the R2 can handle, will probably go to the Scout Traveler… unless Rivian makes the R1S even more rugged in Gen 3 (locking diffs, full size spare tire carrier, etc.), but there’s not a large market for that level of off road capability, so I don’t think they’ll go that way.

I think R1S sales are already falling and once the R2 starts delivering they will fall even more. In my opinion, Q1 2026 will not be pretty for Rivian. This might be a good time to buy the stock (not a financial advisor, so who knows). It’s also a slow time for vehicle sales anyway. Q2 2026 onward will be Rivian’s chance to expand and grow.

Rivian wants to be a larger more mass-market EV company. I don’t think they’re going to abandon the R1 line, like Tesla is by discontinuing the Model S and X. Tesla is being forced into an AI and robotics company exclusively by it’s CEO. At some point they want to discontinue all of their drivable vehicles in favor of autonomous ones. I don’t think Rivian will follow suit.

Rivian will have AI and autonomous features and will continue to invest in this space (LiDar, G3 HW, AI assistant, etc.), but they’ll continue to create vehicles. They’re already brainstorming about what an R4 or an R5 will look like (I’m hoping for a more compact truck than the R1T and a van.) They care about form factor and the right tool for the job. The R1 line isn’t going anywhere.

Right now Rivian is focused on ramping the R2. Then it will be the R3 at the Georgia plant. At some point they’ll be exporting to Europe. In the background they’ll be quietly redesigning the R1 line. I think we’ll see the G3 R1s in the early 2030’s.

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[Dhevey]

100% the same thing for me.

I need the size of the R1 to haul dogs. I like the size of the R2 for my wife, so we have one reserved. So yes, there is room for both. When we get the R2, I will drive it more than I drive our Mach e.

 

[Redline]

I need the size of the R1 to haul dogs. I like the size of the R2 for my wife, so we have one reserved. So yes, there is room for both. When we get the R2, I will drive it more than I drive our Mach e.

I have the R1S and my wife will have the R2. She thinks the R1S is just too big for her, but we need it for the kiddo and doggo.

 

[tpberding]

He mentioned something I’ve been thinking: R1S sales will fall when R2 comes out. And if Tesla’s trajectory is any indication, R1S may eventually go the way of Model X in a few years - meaning discontinued. There’s basically two factors that will keep R1S alive: 1) people who want 3 rows/7 seats and 2) Those who want to go more off-road than the R2 can handle.

For the first group, I think the R2 platform is flexible enough to shorten to make an R3, it’s probably flexible enough to stretch to make a 3 row R2. Again, it’d be like what Tesla did in China: make a longer Model Y with 3 rows.

And for the 2nd group, people who want to go even more off-road than the R2 can handle, will probably go to the Scout Traveler… unless Rivian makes the R1S even more rugged in Gen 3 (locking diffs, full size spare tire carrier, etc.), but there’s not a large market for that level of off road capability, so I don’t think they’ll go that way.

There will always be a market for a higher-end, larger SUV from Rivian. Look at the other big SUVs that are even bigger and just as expensive--Escalade, for example, that continue to sell well. Those big ICE vehicles will gradually go EV. Also, there is no reason the production economies Rivian has built into the R2 can't be incorporated into future R1s.

 

[ndmiller]

I don't think the R2 will cut into R1T at all. Are there customers that want a traditionally shaped EV that will choose smaller over larger for less money, sure they will. Will customers that need the R1S room move down to the R2, again don't think so. I'm betting R1 is essentially flat with R2 being the growth, just as strategized for the last couple years.

 

[Schroederhc]

IX3 will be the big deal if the pricing lines up. While they have slightly different purposes someone buying a 65k SUV will shop both.

If you want a great software experience and OTAs the Rivian should come out ahead

 

[R2D2TOO]

IX3 will be the big deal if the pricing lines up. While they have slightly different purposes someone buying a 65k SUV will shop both.

Some will, assuming the prices line up. Not me. I find the form factor of my 4Runner very useful. I’ve had two. The R2 will replace my current one. The BMW holds zero interest for me.
Additionally, I have concerns about trad carmakers making EVs, as that model does not bode well for its dealer networks. The dealers do rely on maintenance services for their continued existence.

 

[ENVErider]

Did he review the BMW iX3 and the Volvo EX60? Can't give much weight without comparing to all of the vehicles coming out at the same time.

I agree that the iX3 and EX60 are the strongest competitors entering this sector in 2026, but netiher are directly comparable to the R2; the EX60 cross-country model might get close, but no one will be taking the ix3 off road on some of the terrain we've already seen the R2 validation builds taking on this Tuesday.
I think Tesla should be more worried about the iX3 than Rivian; the iX3 appears to be a direct Model Y competitor, and for anyone like me who doesn't prioritize autonomy, it's more compelling. The ix3 interior is so much nicer than the Y, albeit a bit space-age. Of course, neither of these is actually ready to ship, and there's a chance they'll be released at higher prices, allowing Tesla to keep its lead.

 

[renderpaz]

The iX3 sounds like it will be very compelling, and no doubt a few buyers will cross shop the R2, but I think it will be largely irrelevant to R2 for one simple reason:

The iX3 isn't cool and the R2 is.

Some people don't want cool, they want certain specs and the badge. They might choose the BMW. The R2 is an aspirational product, the iX3 isn't.

All the press for iX3 will undoubtedly call attention to the R2 - could actually have a positive effect on sales.

 

[electruck]

My hope is that with the R2 release, Rivian can afford to be less price conscious with the R1. That would open up the door for things like a truly upgraded stereo system and for R1 to introduce next gen battery and other tech that may initially be too cost prohibitive for R2 and R3. Probably won't play out like that but that's my hope - I'd love a Gen3 R1S Quad with a kick ass stereo and SSB!

 

[KRG]

I hope they don’t kill R1 and I doubt they will. I think they’ll continue to take what they learned with R2 and refine R1 to make it less complex. I agree a lower priced variant with a simpler suspension would be a good idea. The R2 is too small for some families. Tesla only cares about robotaxis long term, so that explains their choice to let products stagnate and die, not sure Rivian is in the same boat.

 

[sparked]

I agree that the iX3 and EX60 are the strongest competitors entering this sector in 2026, but neither are directly comparable to the R2; the EX60 cross-country model might get close, but no one will be taking the ix3 off road on some of the terrain we've already seen the R2 validation builds taking on this Tuesday.

At Rivian's volume ambitions of 175k per year just out of Normal and not including the one's in Georgia, I don't think most people will be taking Rivian R2s off road. That's why on-road characteristics like ride quality and even autonomy matters so much in R2 design.

With the limited great EV options in the marketplace that RJ regularly talks about in interviews, people will definitely be cross shopping these even if they aren't all quite comparable. If we had a dozen great EVs with people spreading out to different segments, I might believe that it would be different. Maybe in 2027 or 2028.

 

[usulio]

The other advantage of R1S is range and towing. R2 won’t be impressive there unless they make a much bigger battery pack option, which they probably won’t because it competes with R1

 

[savethemanual]

The iX3 sounds like it will be very compelling, and no doubt a few buyers will cross shop the R2, but I think it will be largely irrelevant to R2 for one simple reason:

The iX3 isn't cool and the R2 is.

Some people don't want cool, they want certain specs and the badge. They might choose the BMW. The R2 is an aspirational product, the iX3 isn't.

All the press for iX3 will undoubtedly call attention to the R2 - could actually have a positive effect on sales.

The upgraded iX3 M70 that will be coming (or whatever they call it) is going to be a performer. Very interested in that comparison with the R2 Tri.

 

[Biturbowned]

I agree that the iX3 and EX60 are the strongest competitors entering this sector in 2026, but netiher are directly comparable to the R2; the EX60 cross-country model might get close, but no one will be taking the ix3 off road on some of the terrain we've already seen the R2 validation builds taking on this Tuesday.
I think Tesla should be more worried about the iX3 than Rivian; the iX3 appears to be a direct Model Y competitor, and for anyone like me who doesn't prioritize autonomy, it's more compelling. The ix3 interior is so much nicer than the Y, albeit a bit space-age. Of course, neither of these is actually ready to ship, and there's a chance they'll be released at higher prices, allowing Tesla to keep its lead.

I agree with all of this.

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