R1S Adventure Delivery Day

[NineElectrics]

Any pics available of the lift gate? I’m curious about misalignments.

Sponsored

 

[Mygrain]

No more disclaimers people.... just congrats ?

s00n.RivianStories.com

 

[IlliniRivian]

Fwiw, I took delivery of my R1S LE at the factory yesterday and got the tour.

I was impressed with it all. Saw many different combos of exterior and interior colors plus models - but don’t recall an OC on an R1S. I was told they were staffing up for a third shift and saw large groups of new hires getting orientation type tours.

 

[Guy]

Fwiw, I took delivery of my R1S LE at the factory yesterday and got the tour.

I was impressed with it all. Saw many different combos of exterior and interior colors plus models - but don’t recall an OC on an R1S. I was told they were staffing up for a third shift and saw large groups of new hires getting orientation type tours.

Amazed they are going for a third shift when they are still running below 30% of capacity.

 

[Comstockery]

Glad to see another R1S owner in the DMV.

 

[zigzagzap]

Super stoked, easy peasy!!!

Here’s my story if you want details
https://www.rivianforums.com/r1s-ad...he-digital-purchasing-process-email-received/

Congrats. I'm happy for you. You have exceptional taste. I ordered the same setup on 1/1/19 and I still am waiting, though hopefully not much longer but I did lose out on the tax credit. No rhyme or reason or order priority by Rivian which only creates animosity and discontent (read Rivian suxs .)

 

[Dymo]

yeeep, ordered 11/20 and I’m still a few months out myself and 20 minutes from the SC (but ocean coast, so, ya know)

Congrats on the delivery! Looks amazing, obviously! The white is so sharp but I’m staying strong on FG

Same order date and config as you and also same ETA. Only difference is I have factory pickup requested on mine.

 

[VSG]

Amazed they are going for a third shift when they are still running below 30% of capacity.

Why are you amazed? To me, things seem to be going as planned. "Capacity" assumes three full shifts. If they are running one shift, they can only reach 1/3 of the "capacity". So adding a third shift is REQUIRED if they plan to run at capacity.

The plan spelled out in the IPO is to hit the 150k run rate (i.e. "capacity") at the end of the year. They already have demonstrated a run rate of 50k a year with 1+ shifts ("+" because they hit 50k with one shift, but have recently added a second shift so their Q4 production numbers and run rate represent more than 1 shift but less than 2 fully operational shifts). Adding a third shift will increase their production by at least 50%. All of this assumes that supply chain issues can be managed.

With the demonstrated QoQ production increases over the past year, and with the R1S and EDV lines coming up to full speed now, I think they are well-positioned to meet their goal for 2023. We will find out more during the earnings call in two weeks, where I also expect they will announce their production target for 2023 - that target will be more than 50k (which they have already demonstrated) and must be less than 150k (which they will only hit at the end of the year), so I think 75k is do-able but they will probably set a lower target just because the day traders don't like it if they miss their number even by a tiny bit.

 

[Guy]

Why are you amazed? To me, things seem to be going as planned. "Capacity" assumes three full shifts. If they are running one shift, they can only reach 1/3 of the "capacity". So adding a third shift is REQUIRED if they plan to run at capacity.

The plan spelled out in the IPO is to hit the 150k run rate (i.e. "capacity") at the end of the year. They already have demonstrated a run rate of 50k a year with 1+ shifts ("+" because they hit 50k with one shift, but have recently added a second shift so their Q4 production numbers and run rate represent more than 1 shift but less than 2 fully operational shifts). Adding a third shift will increase their production by at least 50%. All of this assumes that supply chain issues can be managed.

With the demonstrated QoQ production increases over the past year, and with the R1S and EDV lines coming up to full speed now, I think they are well-positioned to meet their goal for 2023. We will find out more during the earnings call in two weeks, where I also expect they will announce their production target for 2023 - that target will be more than 50k (which they have already demonstrated) and must be less than 150k (which they will only hit at the end of the year), so I think 75k is do-able but they will probably set a lower target just because the day traders don't like it if they miss their number even by a tiny bit.

I am amazed because there is no way they have a 150k target for this year. Most estimates I see are 50-75k including R1 and EDV. If those numbers are anywhere near close to what Rivian say at the next analyst call then they will be at c. 30% of capacity and hence a third shift is not needed until late 2024. I would love them to be at a higher run rate but the recent delivery estimates indicate a slow ramp for the R1S.

 

[VSG]

I am amazed because there is no way they have a 150k target for this year.

No, you're not understanding me. The "run rate" is the annualized rate they can produce vehicles. It it most certainly NOT the number of vehicles they will produce in a year. And if they can reach an annualized rate of 150k at the end of the year then, BY DEFINITION, their annual production number CANNOT be close to 150k - it has to be somewhere between the start-of-year rate (50k) and the end-of-year rate (150k), and, since the ramp in production rate is not linear, the real production number will necessarily be significantly below the average of these two numbers.

Most estimates I see are 50-75k including R1 and EDV.

And isn't that EXACTLY what I said above? I said:

that target will be more than 50k (which they have already demonstrated) and must be less than 150k (which they will only hit at the end of the year), so I think 75k is do-able but they will probably set a lower target just because the day traders don't like it if they miss their number even by a tiny bit.

Regardless, if Rivian is going to hit 75k total for the year then they MUST continue to increase their run rate to MORE than 75k/year because if they are just hitting a 75k rate come end of the year then they cannot possibly end the year with 75k produced. This is just straightforward math. If they are going to deliver 75k then they really MUST hit a run rate of 125k-150k by the end of the year given the current ramp. And to do that, a third shift is REQUIRED.

 

[VSG]

but the recent delivery estimates indicate a slow ramp for the R1S

I don't know where you're getting this. By all indications the ramp of R1S production has been steeper than the R1T ramp. R1S started 6 months behind the R1T, but R1S numbers have so far been above what R1T numbers were at the same point in the R1T ramp. R1S production was planned to start 6 months later than the R1T from the beginning - this has been public knowledge since at least 2020.

 

[Guy]

No, you're not understanding me. The "run rate" is the annualized rate they can produce vehicles. It it most certainly NOT the number of vehicles they will produce in a year. And if they can reach an annualized rate of 150k at the end of the year then, BY DEFINITION, their annual production number CANNOT be close to 150k - it has to be somewhere between the start-of-year rate (50k) and the end-of-year rate (150k), and, since the ramp in production rate is not linear, the real production number will necessarily be significantly below the average of these two numbers.

And isn't that EXACTLY what I said above? I said:


Regardless, if Rivian is going to hit 75k total for the year then they MUST continue to increase their run rate to MORE than 75k/year because if they are just hitting a 75k rate come end of the year then they cannot possibly end the year with 75k produced. This is just straightforward math. If they are going to deliver 75k then they really MUST hit a run rate of 125k-150k by the end of the year given the current ramp. And to do that, a third shift is REQUIRED.

Agreed and you make a good point. I would be pleasantly surprised if they can triple their run rate from 4000 to 12000 a month but I would love to see that.

 

[Guy]

I don't know where you're getting this. By all indications the ramp of R1S production has been steeper than the R1T ramp. R1S started 6 months behind the R1T, but R1S numbers have so far been above what R1T numbers were at the same point in the R1T ramp. R1S production was planned to start 6 months later than the R1T from the beginning - this has been public knowledge since at least 2020.

I am getting it from the delays in delivery estimates, from the fact it took at least six months from start of large scale manufacture for the S to produce the first known adventure model. Large scale T production was around February/March last year.
The S order backlog is unlikely to be cleared before end of 2024 (pre March pricing). The T (which did start six/eight months earlier) is cleared by mid year. Also taking the numbers from RivianDad who visited the Denver SC recently and over 75% of the 60+ vehicles were Ts.

 

[VSG]

I am getting it from the delays in delivery estimates, from the fact it took at least six months from start of large scale manufacture for the S to produce the first known adventure model. Large scale T production was around February/March last year.
The S order backlog is unlikely to be cleared before end of 2024 (pre March pricing). The T (which did start six/eight months earlier) is cleared by mid year. Also taking the numbers from RivianDad who visited the Denver SC recently and over 75% of the 60+ vehicles were Ts.

Delivery estimates were changed, not delayed - the mean still stayed the same even though a bunch were moved forward and a bunch were moved back. But also note that Rivian has been much better at hitting these windows over the past 6 months, and in fact is now usually delivering *before* the window from what I can tell. That means that these windows are more "real" than before - we can be much more confident of these new windows.

it took at least six months from start of large scale manufacture for the S to produce the first known adventure model

That's actually quicker than expected. I consider R1S production started in September. It's now been five months. I expected that production of LE and delivery of LE would take place first, and that Adventure deliveries wouldn't start until after that. By my estimate, R1S LE should be done before 2H23. So seeing Adventure just starting to be produced in Q1 is an encouraging sign, the way I see it. I expect Adventure production to be low until the LEs are finished, basically just to validate the build process while not significantly impacting LE builds.

Compared to the R1T, this is far closer to the production plan that Rivian had from the beginning. The R1T production was messed up, partly do to supply constraints, so they had to produce what they could when they could in order to keep up the numbers. That led R1T Adventure production to be much earlier than expected, and that broke the promise of LE having "priority delivery". But I have seen a lot of effort over the past 8 months to fix that process, and the R1S production seems mostly to be adhering to the intended process.

The S order backlog is unlikely to be cleared before end of 2024 (pre March pricing). The T (which did start six/eight months earlier) is cleared by mid year.

I agree that the price-protected R1Ts should be finished sometime in 2023, and I expect Rivian's income will rise significantly because of that. I think that the price-protected R1S will be finished 6 months or so later because R1S production is shifted by 6 months relative to R1T, but it may be sooner since adding a shift will immediately increase production rate for both models. I think end of 2024 is pessimistic, worst case. Rivian has said that by the end of 2024 all price protected orders will be delivered, so I see end of 2024 as worst case. When they make absolute statements like this, the number is worst-case depending on the "weakest link" If they can deliver 95% of price protected orders by mid-2024, that's not good enough, so their target has to represent the worst case. And for price-protected orders, the worst case is orders from Canada, where they are significantly behind in delivering, and Max pack orders, which they haven't been able to deliver. Both of these will prevent 100% of price protected orders being filled in 2023, but I think that the vast majority will be finished in 1H24, with only a trickle of exceptions remaining.

Finishing price-protected orders will mean a large boost in revenue, and IMO Rivian is trying very hard to get that out of the way and put those in the rear view - that milestone will come with a huge change in perception because it will demonstrate that Rivian has been able to deliver over its first two years.

Also taking the numbers from RivianDad who visited the Denver SC recently and over 75% of the 60+ vehicles were Ts.

We really don't know what the mix of orders is, or even what the mix was in the LE orders, but my impression has always been that R1T was the majority of the LE, and a majority of the price protected orders, but that the mix has tilted more towards the R1S has time goes on. Because the R1S ramp is (deliberately) 6 months behind the R1T ramp, I fully expect that it will take some time to hit their target mix, whatever that is. You don't expect them to slow down the R1T production just so they have the right mix between R1T and R1S, do you? Instead, what has to happen is the R1S needs to keep increasing production until that desired mix is reached.

 

[VSG]

I would be pleasantly surprised if they can triple their run rate from 4000 to 12000 a month but I would love to see that.

4Q22 was over 10000. I don't think it's a stretch at all to reach 12k/mo - I think they will easily hit that in 1Q23.

EDIT: I misread the post I quoted. Yes, I agree the current production was 4k/month and has to reach 12k/mo at the end of the year in order to achieve an annualized rate of 150k/year. I think adding a third shift helps get Rivian there, since it increases production by 50% at least.

Sponsored