Rivian
likes
to
think
of
itself
as
a
trailblazer.
It
was
first
to
market
with
an
all-electric
truck
and
is
still
one
of
the
few
companies
today
selling
an
electric
three-row
SUV.
And
its
EVs
are
marketed
for
off-road
adventures
—
the
literal
blazing
of
trails.
But
on
March
7th,
Rivian
will
release
its
next
vehicle,
and
arguably,
it
won’t
be
breaking
a
lot
of
new
ground.
The
Rivian
R2
is
a
two-row
compact
SUV
with
around
300
miles
of
range
and
a
starting
price
somewhere
around
$45,000.
It’s
not
exactly
a
major
disruption
by
today’s
standards,
where
the
Tesla
Model
Y,
Ford
Mustang
Mach-E,
and
other
compact
electric
SUVs
currently
dominate
the
sales
chart.
Rivian
is
revealing
the
R2
during
an
especially
tumultuous
time
for
EVs
Rivian
is
also
revealing
the
R2
during
an
especially
tumultuous
time
—
for
itself
and
the
entire
auto
industry.
EV
sales
are
up,
but
growth
has
slowed
considerably
as
more
customers
have
proven
reluctant
to
make
the
switch,
wary
of
high
prices
and
EV
charging
reliability.
And
Rivian
is
finding
itself
in
a
considerable
cash
crunch,
as
its
costs
grow
beyond
the
pace
of
its
revenue.
The
R2
is
a
major
moment
for
Rivian
—
no
question
there.
But
that
car
won’t
start
production
until
2026
at
the
earliest,
making
this
year
and
next
crucial
if
the
company
hopes
to
live
long
enough
to
see
it.
Photo
by
Daniel
Golson
for
The
Verge
Last
month,
Rivian
reported
its
fourth
quarter
earnings
for
2023,
and
it
wasn’t
pretty.
The
company
reported
losing
$1.58
billion
over
the
last
three
months
of
the
year,
bringing
its
net
annual
losses
to
$5.4
billion.
It
also
announced
plans
to
lay
off
10
percent
of
its
salaried
employees,
the
third
such
round
of
layoffs
in
the
last
two
years.
But
it
was
the
production
numbers
that
most
triggered
a
stock
slide.
Rivian
predicted
it
would
only
produce
57,000
vehicles
in
2024,
down
from
the
80,000
vehicles
that
were
anticipated
by
Wall
Street
and
relatively
flat
from
last
year’s
numbers.
But
profits
were
on
the
horizon,
the
company
promised.
A
multi-week
shutdown
of
its
Normal,
Illinois,
factory
will
bring
improvements
to
the
R1
line,
with
production
rates
improving
“approximately
30
percent”
as
a
result.
Rivian
predicted
it
would
eke
out
a
“modest
gross
profit”
in
the
fourth
quarter
of
2024.
Investors
were
dubious.
How
could
a
company
that
couldn’t
realistically
predict
a
growth
in
production
expect
to
compete
in
an
increasingly
volatile
market?
“Rivian’s
results
continue
to
largely
disappoint,
whether
on
volume
or
margin
progression,”
Morgan
Stanley
wrote
in
a
note
to
clients.
Photo
by
Mitchell
Clark
/
The
Verge
Add
to
the
mix
the
groundbreaking
of
a
new
$5
billion
facility
in
Georgia,
and
you
have
a
recipe
for
a
turbulent
year
for
the
young
company.
(Rivian
was
founded
in
2009
but
only
came
out
of
stealth
in
2018.
It
made
its
public
markets
debut
in
2021.)
Rivian’s
situation
is
not
unique.
As
noted
by
Heatmap’s
Robinson
Meyer,
the
company
is
currently
in
what’s
known
as
“the
EV
valley
of
death,”
in
which
it
has
scaled
up
production
but
isn’t
bringing
in
enough
revenue
to
cover
its
operational
costs.
Welcome
to
the
“EV
valley
of
death”
It’s
an
especially
vulnerable
period
for
a
young
company
to
be
in.
And
Rivian
lacks
a
financial
benefactor
with
bottomless
pockets
like
Lucid
Motors
has
with
Saudi
Arabia’s
Public
Investment
Fund.
Amazon
owns
a
16
percent
stake
in
Rivian,
making
it
the
company’s
largest
stakeholder.
But
the
company’s
influence
over
Rivian
has
diminished
over
time,
especially
after
its
“exclusive”
delivery
van
partnership
ended
last
year.
Rivian
needs
more
customers,
but
that’s
going
to
be
tough
because
the
market
is
cooling.
EV
sales
are
still
growing,
but
Rivian
still
only
makes
up
a
fraction
of
the
total.
Tesla
—
a
company
that
went
through
its
own
“valley
of
death”
phase
with
the
Model
3
and
emerged
as
the
most
valuable
car
company
in
the
world
— still
leads
the
pack.
Depending
on
what’s
released
on
Thursday,
the
R2
will
certainly
bring
more
attention
to
Rivian.
There
will
be
a
lot
of
free
media,
which
the
company
can
hopefully
convert
into
a
significant
number
of
new
reservations.
But
the
vehicle
itself
won’t
go
into
production
until
2026.
The
world
may
look
much
different
by
then.
You
don’t
need
a
crystal
ball
to
know
there
will
be
a
lot
more
competition
by
that
point.
Companies
with
a
lot
more
experience
making
mass-market
vehicles
will
have
a
lot
more
EVs
for
sale.
Rivian
needs
to
sell
its
current
generation
of
vehicles
to
more
customers
in
order
to
survive
the
short
term.
In
terms
of
its
cash
cushion,
Rivian
said
it
had
$7.86
billion
in
cash
and
cash
equivalents
at
the
end
of
the
fourth
quarter,
down
from
the
$9.1
billion
it
had
at
the
end
of
Q3.
At
its
current
burn
rate,
the
company
is
likely
to
run
out
of
cash
before
the
first
R2
even
comes
off
the
assembly
line.
Legacy
car
companies
have
whole
lineups
of
internal
combustion
engine
vehicles
to
fall
back
on
when
times
are
tough.
Ford,
GM,
and
others
are
reporting
robust
hybrid
sales,
for
example,
which
helps
take
some
of
the
sting
out
of
the
billions
they’re
losing
on
EV
development
and
production.
Rivian
is
what’s
known
in
the
industry
as
a
pure
play
EV
company,
meaning
it
only
makes
battery-electric
vehicles.
No
hybrids.
No
gas.
Just
electrons.
That
also
means
no
backstop,
no
safety
net.
If
the
EV
market
stumbles,
then
Rivian
takes
it
square
on
the
chin.
Rivian
says
the
entire
auto
industry
is
moving
to
electric,
and
once
it
does,
“the
opportunity
ahead
is
substantial.”
That
may
be
true,
but
Rivian
will
need
to
survive
the
next
couple
of
years
if
it
hopes
to
stick
around
long
enough
to
see
that
happen.
Original author: Andrew J. Hawkins
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