Rivian work week reduced to 2-3 days until inventory comes down

[sphereobject]

I didn’t think it was that many needed where is this stated?

Rivian never said this. It’s math. If they can make $5,500 per R2 at 500,000 annual units that’s $2.75 Billion in income for that product , which would likely cover the company’s interest, massive SG&A, R&D, and the losses on the R1 line.

Sponsored

 

[Donald Stanfield]

Rivian never said this. It’s math. If they can make $5,500 per R2 at 500,000 annual units that’s $2.75 Billion in income for that product , which would likely cover the company’s interest, massive SG&A, R&D, and the losses on the R1 line.

The R1 line is gross margin positive.

 

[sphereobject]

The R1 line is gross margin positive.

I have owned 2 R1S, and a R1S is my current daily driver. I am not posing as anti-Rivian.

With where sales volumes have gone and are going with the R1 line, it is unlikely to be a going-forward gross-margin-positive vehicle. Even if it were, with its paltry sales volumes it is clear that the R1 line will never come anywhere close to covering the company’s interest expenses, massive SG&A, and R&D, etc.

The cash flow and balance sheet situation no es bueno.

 

[Donald Stanfield]

I have owned 2 R1S, and a R1S is my current daily driver. I am not posing as anti-Rivian.

With where sales volumes have gone and are going with the R1 line, it is unlikely to be a going-forward gross-margin-positive vehicle. Even if it were, with its paltry sales volumes it is clear that the R1 line will never come anywhere close to covering the company’s interest expenses, massive SG&A, and R&D, etc.

The cash flow and balance sheet situation no es bueno.

There’s a conflation of terms here and I think that’s where the disconnect is coming from. Gross margin positive simply means the direct manufacturing costs for the vehicles are less than what they can be sold for. It doesn’t take anything else into account, including indirect costs or sales volumes.

I never claimed R1 would be enough to sustain Rivian, I think it’s obvious they are not. R1 is an added value to the bottom line, not a detrimental factor. The R2 should be better, but we have no idea what the margin is on one.

My whole point is we cannot accurately predict the number of units needed for R2 to cover Rivian’s indirect costs. We would need Rivian’s internals to say R2s need to sell in X numbers to cover costs.

 

[NY_Rob]

Expecting Rivian to produce and sell half a million R2's per year is reeeeeally stretching it. We're still talking $50-$70K+ vehicles here, not $35K vehicles.

 

[UnsungZero_OldTimeAdMan]

My whole point is we cannot accurately predict the number of units needed for R2 to cover Rivian’s indirect costs. We would need Rivian’s internals to say R2s need to sell in X numbers to cover costs.

Right. It’s moot to speculate and argue over differing speculations. (You think ancient shamans did this whenever they got together? )

We’ll all see what will actually happen soon enough. A third of 2025 is almost over.

 

[iansriv]

You think ancient shamans did this whenever they got together? )

Probably too stonned.

 

[shap]

Regist

I’ll have mine well past the Warrenty period.

I have a Tesla that is 9 years old, I’ve had 2 repairs after Warrenty, a rear window regulator for $400, and center screen replaced, $1100. That $1500 would not have covered the registration for a new car had I traded it in after the Warrenty expired. Probably was less money than an extended Warrenty would have been as well.

If something goes wrong it could be expensive but factoring in higher registration and insurance, not to mention the cost of actually purchasing a new car, makes not being in Warrenty very hard to justify as a reason for me to get rid of a vehicle that I’m happy with and runs great.

Registration is 75$ in TX +200$ EV fee. Insurance (the highest possible comprehensive) is 125$ per month. So it is not a big deal here.

 

[SANZC02]

Rivian never said this. It’s math. If they can make $5,500 per R2 at 500,000 annual units that’s $2.75 Billion in income for that product , which would likely cover the company’s interest, massive SG&A, R&D, and the losses on the R1 line.

$5500 per vehicle seems short, ASP is likely going to be around 58k, that is only a 9.5% margins.

They should be targeting at least a 20% margin, if not 25%. That should put them closer to 1.16 billion at 20% or 1.45 billion at 25% per 100k units.

For comparison, Tesla makes around 29% on the Model Y.

 

[UnsungZero_OldTimeAdMan]

$5500 per vehicle seems short, ASP is likely going to be around 58k, that is only a 9.5% margins.

They should be targeting at least a 20% margin, if not 25%. That should put them closer to 1.16 billion at 20% or 1.45 billion at 25% per 100k units.

For comparison, Tesla makes around 29% on the Model Y.

20% margin on cars is not realistic. Industry average for each car is 5~10% (this is why they all produce very few low-trim examples at the advertised starting price). Tesla's margin is speculated to be around 15% due to greater vertical integration than rest of industry.

 

[Riv_Ian]

I just booked in for service in Madison Heights. Next appointment, +20 days. Just another data point.

 

[SANZC02]

20% margin on cars is not realistic. Industry average for each car is 5~10%. Tesla's margin is speculated to be around 15% due to greater vertical integration than rest of industry.

Pretty sure that 15% is overall margin not build margin. I was looking back in 2022/2023 where the build margins were close to 30%.

Back then they were making north of 11k per Model Y. Granted my numbers were generic as the more cars they make the lower the fixed costs per vehicle are but if they are only getting 5500 per vehicle on build margins it will be a struggle to survive.

 

[SANZC02]

Regist

Registration is 75$ in TX +200$ EV fee. Insurance (the highest possible comprehensive) is 125$ per month. So it is not a big deal here.

Regist

Registration is 75$ in TX +200$ EV fee. Insurance (the highest possible comprehensive) is 125$ per month. So it is not a big deal here.

Not like that here in California. Sticker on my R1S was 79k, out the door was 88.8k. A lot of that was Tax (7,076) and license(829), almost 8k right there, that covers a lot of repairs.

We also have an excise tax as part of our registration with a 10 year depreciation scale. I’ve renewed my R1S registration twice at 975 and 923, so newer vehicles keep registration fees high.

In California it certainly pays to hang onto a good running vehicle if you’re happy with it.

 

[zymolysis]

Agree, but I am not only looking at what people say on the forums. I look at my truck, my friend's trucks. They do have issues. Some are built-in design, and some just bad QC. Rivian will try to fix design issues with new updated parts as soon as they can.

I never thought I would have a shocks issue (leaking) - all was working fine, and no visual leak was seen from my side. But when they worked on something else, they immediately saw it and replaced it.

How long was it in the Service Center, to do those repairs. Did they give you a loaner?

 

[shap]

How long was it in the Service Center, to do those repairs. Did they give you a loaner?

They offered a loaner, but I took Uber credit as I did not require the car.
It took them 3 weeks to fix it (mostly waiting for the parts). The actual work took
less than 2 day's.

Sponsored