Rivian is planning one of the fastest launches of a new all-electric car in the U.S. with its forthcoming R2 SUV. If successful, this would prove a strong start for a product that founder and CEO RJ Scaringe has called perhaps the most important thing the company has launched to date.
Rivian’s future and its path to profitability hinge on the success of the R2. If it struggles to ramp production and sales, shareholders could flee, raising questions about the company’s strategy of spending billions now to prepare for mass-market scale.
The company told investors it expects to sell between 20,000 and 25,000 R2s this year, with the first deliveries likely starting in June. Even hitting the low end of that target would outpace the sales rate of every other comparable electric vehicle at or under $60,000, except for the Tesla Model Y.
The Model Y took about four months to surpass 20,000 vehicles sold. Rivian aims to do it in about six months, roughly the same timeline as the Honda Prologue. The next-quickest EVs to reach 20,000 sales were the Chevy Equinox EV at around eight months and the Ford Mustang Mach-E at a similar pace. Models with difficult rollouts, like the Tesla Model 3 or the Chevy Blazer EV, took considerably longer.
Rivian is launching the R2 into a much different market. Nearly all those other models benefited from the now-expired $7,500 federal EV tax credit. Major automakers are scaling back EV plans amid looser emissions regulations, and recent tariffs have made vehicles more expensive.
Scaringe has framed these challenges as advantages, arguing the EV market lacks choice, especially at more affordable prices. Rivian has said the R2 SUV will start at $45,000, a price tag Scaringe calls crucial for mass-market success. However, the company is launching with a dual-motor, higher-trim version that will almost certainly cost more, and it has not said when the $45,000 base model will be available. The company removed “Starting at $45,000” from its website in early February but maintains it is committed to that price. More details will be announced at an event on March 12.
Despite current headwinds, there appears to be strong demand for upcoming electric SUVs priced near the R2, like the Volvo EX60, BMW iX3, and Mercedes-Benz GLC. Those won’t arrive in the U.S. until later this year, potentially giving the R2 a competitive advantage. Analysts note Rivian has worked to simplify the R2’s manufacturing process compared to its current vehicles, which should help reach scale faster.
But some Wall Street analysts are skeptical. One recently lowered his price target for Rivian, citing the company’s aggressive R2 launch expectations. Another analyst estimates the R2’s average transaction price could hover around $60,000 or higher for several years while production is based in Illinois, until the company’s new Georgia factory is operational.