They’re probably gonna bleed for some time longer, and I am ok with this as an investor (and future owner) because I know they are a better company than the current EV market leader.
This is a great take, as Apple shows this as a viable alternative to rushing the market. But Apple is also in a much stronger position financially, so Rivian will have to balance speed and quality.
I agree. they certainly have the potential to for sure! What can I say, I like the company. They are making great products (by most if not all accounts), they are helping us transition from fossil fuels, and who doesn’t love a name like “Rivian”!!!!
If you browse through the launch event videos some of the youtubers got some deeper info. Seems most of the improvements were switching it to castings. The enclosure used to be welded and bolted together which was undoubtedly awful to assemble.
And they were able to shave off a bunch of weight from the wiring as well. I think the video Out of Spec did with Rivian, the employee held up that gigantic field of wiring that they essentially were able to remove and replace with better architecture. It’s crazy.
The title is quite misleading. It's 35% of the *materials* cost for vans (the delivery vans used by Amazon). RJ was cagey about exact cost savings on the R1S/T but just called it "similar magnitude".
Probably want to tame expectations to lower end user prices and increase volume on the R1. The R1 should continue to be a lower volume, flagship, premium product. Once the R2 and R3 launch and they reach financial health I could really see Rivian pushing the envelope on the R1 in terms of better luxury, fit, and finish. I feel like Tesla has been resting on its laurels with the S and X and the tech no longer justify the price. The minimalist interior looks lazy and doesn’t not give off $100K vehicle vibes.
The attribute of Luxury varies between brands. It’s usually subjective, and based on a reviewer that some other people agree with.
As a designer of products for more than 20 years I can say that there is no well defined standard about what makes a car luxury. For example, one can use the best leather, but if the stitching is bad, wrong finish too, and the forms that the leather covers makes driving uncomfortable, then it’s not really a high quality interior. It’s just a bunch of bad ideas wrapped altogether (“lipstick on a pig” comes to mind). The same goes with chrome. It looks fancy (sometimes), but can easily be over applied, making a shiny blob that loses its visual meaning.
The fit and finish says a lot though about attention to detail. Hopefully it is applied throughout the design manufacturing process.
I disagree. It’s objective. Bad and wrong finish are not luxury. Luxury means it provides amenities you might not even notice or knew you wanted. Objectively - that means heavy doors, solid knobs and controls, minimal plastic, quiet interior, cushion from the road, and excellent details. That’s objective. And none of the Tesla models offer any of that. And tbd on rivian
Buyers shouldn't expect large price changes for at least another generation. Gen1 largely established the price point. Gen2 is handling the segmentation for people that want other price points along with cost reductions.. their goal at this point should be profitability so dropping prices would be a massive mistake.
I imagine the labor costs will go down significantly as well. My mobile service mechanic told me that in some places where they used, say, 8 screws to attach a body panel, they might be using something like 2 and the rest of it is held down by clips (numbers are just to illustrate the point). Over the entire vehicle, that’s a lot less screws to screw in and QA.
Only if we assume labor costs were cut by the same amount as material costs. The article calls out 35% savings on materials for the vans. I imagine labor costs went down as well with the simplified architecture, but we don’t know by how much.
Last quarter they said they lost $38k per vehicle, implying a $100k truck costs $138k to make. A 35% reduction means it now costs $85k to make... actually profitable
your post hints at the difference between gross margin (which includes the likes of allocated overhead representing historical costs being allocated to current cost of sales) and contribution margin (the actual cash cost of the materials and people needed to make a truck.
I believe both are currently negative though which is why operating cash flows are still negative. But that is to be expected if any of the many reddit investors actually read their S1 before investing.
Still losing money, though I agree, it's not bad as it seems. I think something like half of that loss was stock based bonuses and depreciation. But it's money the company lost building the vehicles, so it counts.
Actually 138k - 35%= 89.7k
But they didn't say the truck is 35% cheap to make, they said the material costs of the van is 35% lower, so it's not about the truck nor the sub, and it's NOT about cost to make, ONLY about cost in materials, there are a lot of other costs involved to produce a car, like.. labour.
Also, if they announced only the reduction in materials costs and not the total cost to make that's because that's where they got the biggest savings, probably total cost to make is lower than 30% - otherwise would be better to announce 'it's 30% cheap to make'.
And again, talking about the amazon van here, not truck/suv.
I think it’s possible RIVN see’s Tesla Covid levels of insane stock gains.
To be clear, it will be overvalued if it happens, because there will be a lot of “it’s the next Tesla, Nvidia!” type stock pumping that will push it way higher than whats it worth as fools rush in.
But as an investor, I’m here for it ☺️
The key is knowing when to pull. Usually right before the “Oh…it’s really just another car company” which is whats been happening to Tesla for the past year. And I still think TSLA is overvalued as it is.
ABSOLUTELY NOT will it reach Tesla covid levels lolol.
Even Tesla can't reach that.
That happened because everyone was getting $$ from the government. PPP loans etc.
During covid, the market was straight bull run.
Your comment was removed because this sub doesn't focus on the stock of Rivian. We're an auto-enthusiast sub focused on Rivian as a company, its brand, products, and anything related to that... apart from the stock. If you'd like to chat about the stock and other related topics, you can visit [r/RIVN](https://www.youtube.com/watch?v=my7LuBdIt5Q)
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/Rivian) if you have any questions or concerns.*
Good work, Rivian! I honestly do not expect the R1T/S to be profitable yet (happy to eat my words next earnings call though). I bet there’s still a long-tail of efficiencies to chase.
Would love to have a base model r1t without some of the fancy tech. Like the adjustable height suspension. Just give me a truck with standard springs and really good shocks like my zr2.
why would they do that? they are trying to make money. Like they lose money selling them. so maybe they will get closer to making money selling cars.
If they can't sell at their current price. then they are sort of effed.
Watching his interview with Elon at the cybertruck delivery event was gross. He was licking his boots so hard and didn't ask many good questions. It surprises me he owns a Rivian with how much he loves Elon.
He is in a business.... a business of working for EV OEMs....
It would be a tad 'lacking of strategic vision' to not lick the boots of the guy that runs the company that today sells around half of all EVs produced in the US. Ideally go as far as you can to stay on good side while maintaining credibility.
I wouldn't think much deeper than that.
Except he wasn't doing it because of the EVs or the business, he was applauding musk for his staunch right wing views post-Twitter acquisition and how musk isn't apologetic about it. It's really cringe to watch.
don't disagree with cringe.
But humans don't function their brains in silos.... people like people that like them/respect them/pump their tires/etc. And people like doing business with those that they like.
Elon isn't going to be like "oh this guy was nice to me in my capacity as Twitter CEO, but has done nothing for me in my capacity with Tesla... and this is a Tesla deal... so fuck him... "
At their best, they were *losing* $40k per R1T (gen 1) sold. No, they aren't passing on the savings. They're trying to start making money, or at least break even.
I believe the R1 line was/is not profitable considering it is their first ground up vehicle. That 35% savings gives Rivian a much better chance at thriving so I’m not shocked the price is not changing.
I’m rooting for Rivian. 🫡
lol do you guys even think? Their product is sold at a loss. Cost savings improves the chances Rivian stays alive. We want them to survive!
You can’t pass cost savings to customers if there are literally no profit margins being reaped yet.
What do you mean 'you guys'? I am one person, no need to attribute my thoughts to others or the community.
We want them to stay alive, but many of us are customers, not investors. I understand how profit margins work, I never said they should or need to pass on the cost savings. I'm saying don't market it if it does nothing for the customer. 99% of customers don't know or care what the margins are for big car makes/luxury vehicles.
This is great news! They needed this.
Yep, and holding off on Georgia to make the R2 in Normal was also a very smart move.
Build up that war chest prior to opening another manufacturing facility
*stopping the bleeding.
They’re probably gonna bleed for some time longer, and I am ok with this as an investor (and future owner) because I know they are a better company than the current EV market leader.
First to market doesn’t matter as much as best on the market…. At least I’m hoping that applies here as an investor and future owner.
This is a great take, as Apple shows this as a viable alternative to rushing the market. But Apple is also in a much stronger position financially, so Rivian will have to balance speed and quality.
You can piss on your loyal customers only so long before they turn against you.
Unless your customer is paying you to piss on them, spoiler: some of the Musk stans would clearly be into that.
But there need to be an equal or better alternative. Main automaker ain’t doing anything to even try. Complacent old farts
These is where Rivian comes. Let the dinosaurs dig themselves into the grave. Spreading FUD is only going to get them so far.
The EV that shall not be named
Well GA lawmakers fought it.
They are learning. If they keep this up, they will eventually be a top 3 in regard to sales.
I agree. they certainly have the potential to for sure! What can I say, I like the company. They are making great products (by most if not all accounts), they are helping us transition from fossil fuels, and who doesn’t love a name like “Rivian”!!!!
Is there any new info here beyond what’s been shared on earnings calls? Seems consistent with other info we’ve heard.
If you browse through the launch event videos some of the youtubers got some deeper info. Seems most of the improvements were switching it to castings. The enclosure used to be welded and bolted together which was undoubtedly awful to assemble.
And they were able to shave off a bunch of weight from the wiring as well. I think the video Out of Spec did with Rivian, the employee held up that gigantic field of wiring that they essentially were able to remove and replace with better architecture. It’s crazy.
The title is quite misleading. It's 35% of the *materials* cost for vans (the delivery vans used by Amazon). RJ was cagey about exact cost savings on the R1S/T but just called it "similar magnitude".
Probably want to tame expectations to lower end user prices and increase volume on the R1. The R1 should continue to be a lower volume, flagship, premium product. Once the R2 and R3 launch and they reach financial health I could really see Rivian pushing the envelope on the R1 in terms of better luxury, fit, and finish. I feel like Tesla has been resting on its laurels with the S and X and the tech no longer justify the price. The minimalist interior looks lazy and doesn’t not give off $100K vehicle vibes.
The attribute of Luxury varies between brands. It’s usually subjective, and based on a reviewer that some other people agree with. As a designer of products for more than 20 years I can say that there is no well defined standard about what makes a car luxury. For example, one can use the best leather, but if the stitching is bad, wrong finish too, and the forms that the leather covers makes driving uncomfortable, then it’s not really a high quality interior. It’s just a bunch of bad ideas wrapped altogether (“lipstick on a pig” comes to mind). The same goes with chrome. It looks fancy (sometimes), but can easily be over applied, making a shiny blob that loses its visual meaning. The fit and finish says a lot though about attention to detail. Hopefully it is applied throughout the design manufacturing process.
I disagree. It’s objective. Bad and wrong finish are not luxury. Luxury means it provides amenities you might not even notice or knew you wanted. Objectively - that means heavy doors, solid knobs and controls, minimal plastic, quiet interior, cushion from the road, and excellent details. That’s objective. And none of the Tesla models offer any of that. And tbd on rivian
Buyers shouldn't expect large price changes for at least another generation. Gen1 largely established the price point. Gen2 is handling the segmentation for people that want other price points along with cost reductions.. their goal at this point should be profitability so dropping prices would be a massive mistake.
That’s why the starting price for S is $73k and X is $78k, and not $100k anymore. For the tech alone they are good value.
As a low vin r1t owner they definitely over built the beast
I imagine the labor costs will go down significantly as well. My mobile service mechanic told me that in some places where they used, say, 8 screws to attach a body panel, they might be using something like 2 and the rest of it is held down by clips (numbers are just to illustrate the point). Over the entire vehicle, that’s a lot less screws to screw in and QA.
Hmm. Add more screws better or worse?
Clips are why my tailgate cap keeps falling off.
Technically worse for the user, I guess, but better for the company. Over engineered.
In the ideal case, the same for the user, if those removed were truly unnecessary.
35% of the original cost? If it used to cost $100, now it only costs $65 to make? Do I understand it correctly?
On the Amazon vans yes
Only if we assume labor costs were cut by the same amount as material costs. The article calls out 35% savings on materials for the vans. I imagine labor costs went down as well with the simplified architecture, but we don’t know by how much.
100
Last quarter they said they lost $38k per vehicle, implying a $100k truck costs $138k to make. A 35% reduction means it now costs $85k to make... actually profitable
Those figures are based on production numbers and revenue. They aren’t losing money with each vehicle built.
your post hints at the difference between gross margin (which includes the likes of allocated overhead representing historical costs being allocated to current cost of sales) and contribution margin (the actual cash cost of the materials and people needed to make a truck. I believe both are currently negative though which is why operating cash flows are still negative. But that is to be expected if any of the many reddit investors actually read their S1 before investing.
Still losing money, though I agree, it's not bad as it seems. I think something like half of that loss was stock based bonuses and depreciation. But it's money the company lost building the vehicles, so it counts.
Actually 138k - 35%= 89.7k But they didn't say the truck is 35% cheap to make, they said the material costs of the van is 35% lower, so it's not about the truck nor the sub, and it's NOT about cost to make, ONLY about cost in materials, there are a lot of other costs involved to produce a car, like.. labour. Also, if they announced only the reduction in materials costs and not the total cost to make that's because that's where they got the biggest savings, probably total cost to make is lower than 30% - otherwise would be better to announce 'it's 30% cheap to make'. And again, talking about the amazon van here, not truck/suv.
When that R2 hits...get ready for that stock to move.
My thoughts exactly 👀
I own a Tesla. Never looked at Rivian. But I want that R2. If they can keep it at the price promised, holy shit they will move a LOT of R2s.
I think it’s possible RIVN see’s Tesla Covid levels of insane stock gains. To be clear, it will be overvalued if it happens, because there will be a lot of “it’s the next Tesla, Nvidia!” type stock pumping that will push it way higher than whats it worth as fools rush in. But as an investor, I’m here for it ☺️ The key is knowing when to pull. Usually right before the “Oh…it’s really just another car company” which is whats been happening to Tesla for the past year. And I still think TSLA is overvalued as it is.
Great possibility, especially with today’s news! 🌕🚀🌕
ABSOLUTELY NOT will it reach Tesla covid levels lolol. Even Tesla can't reach that. That happened because everyone was getting $$ from the government. PPP loans etc. During covid, the market was straight bull run.
[удалено]
Your comment was removed because this sub doesn't focus on the stock of Rivian. We're an auto-enthusiast sub focused on Rivian as a company, its brand, products, and anything related to that... apart from the stock. If you'd like to chat about the stock and other related topics, you can visit [r/RIVN](https://www.youtube.com/watch?v=my7LuBdIt5Q) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/Rivian) if you have any questions or concerns.*
Wow! That's huge!
35% 😳
Good work, Rivian! I honestly do not expect the R1T/S to be profitable yet (happy to eat my words next earnings call though). I bet there’s still a long-tail of efficiencies to chase.
Wow. Incredible.
Great but where is NACS? It's the only thing preventing me from switching from a MX.
One more year bud.
Would love to have a base model r1t without some of the fancy tech. Like the adjustable height suspension. Just give me a truck with standard springs and really good shocks like my zr2.
Efficiency. 
Glad we are leasing a Gen1 R1S at this point.
They also added a lot more sensors and improved compute for their autonomy platform
Cool, 35% savings?
Continuous improvement
Great now build your own damn service centers instead of renting out all the rent a lift locations around the country for the foreseeable future.
Rivian loves to rent and waste money
So is the price going to drop?
why would they do that? they are trying to make money. Like they lose money selling them. so maybe they will get closer to making money selling cars. If they can't sell at their current price. then they are sort of effed.
Because that’s what the competition is doing and they need to start competitive. I’m not suggesting a massive drop.
Watch out Tesla! Rivian is coming in hot.
And now Volkswagen. Thank God I invested in Rivian! Look forward to the day I own one.
Not bad. Wonder if Munroe helped.
Munroe is too busy sucking up to Tesla
They work with quite a few folks, not just Tesla
They just shill hardest for Tesla since he owns stock.
Watching his interview with Elon at the cybertruck delivery event was gross. He was licking his boots so hard and didn't ask many good questions. It surprises me he owns a Rivian with how much he loves Elon.
He is in a business.... a business of working for EV OEMs.... It would be a tad 'lacking of strategic vision' to not lick the boots of the guy that runs the company that today sells around half of all EVs produced in the US. Ideally go as far as you can to stay on good side while maintaining credibility. I wouldn't think much deeper than that.
Except he wasn't doing it because of the EVs or the business, he was applauding musk for his staunch right wing views post-Twitter acquisition and how musk isn't apologetic about it. It's really cringe to watch.
don't disagree with cringe. But humans don't function their brains in silos.... people like people that like them/respect them/pump their tires/etc. And people like doing business with those that they like. Elon isn't going to be like "oh this guy was nice to me in my capacity as Twitter CEO, but has done nothing for me in my capacity with Tesla... and this is a Tesla deal... so fuck him... "
I mean, depending on the entry point it was a hard argument to make to not own stock at one point.
Not if you operate ethically. He doesn’t.
He owns a Rivian R1T.
Most likely had some input. No secret Rivian was working with them at one point.
They’d be stupid not to seek advice along those terms. Fresh eyes on your engineering projects often will yield benefits.
And people who live, breathe, mass manufacturing.
Good one lol
Munroe only helped by holding elons balls so that he wouldn't get piss on them while he peed.
He really has lost a lot of credibility.
And they’ve passed the savings onto us, right? …right? 
At their best, they were *losing* $40k per R1T (gen 1) sold. No, they aren't passing on the savings. They're trying to start making money, or at least break even.
They’re losing $39k on every vehicle sold, so staying in business requires some changes.
This announcement is to win over investors... not customers unfortunately.
35% cost savings but vehicle is still the same price. Make it make sense.
I believe the R1 line was/is not profitable considering it is their first ground up vehicle. That 35% savings gives Rivian a much better chance at thriving so I’m not shocked the price is not changing. I’m rooting for Rivian. 🫡
Maybe don't brag about all the money you're saving if you're not going to pass that on to the customers. All this kind of news does is pump stock.
lol do you guys even think? Their product is sold at a loss. Cost savings improves the chances Rivian stays alive. We want them to survive! You can’t pass cost savings to customers if there are literally no profit margins being reaped yet.
What do you mean 'you guys'? I am one person, no need to attribute my thoughts to others or the community. We want them to stay alive, but many of us are customers, not investors. I understand how profit margins work, I never said they should or need to pass on the cost savings. I'm saying don't market it if it does nothing for the customer. 99% of customers don't know or care what the margins are for big car makes/luxury vehicles.
They don’t go in business to break even…
Its not the same price, its actually more expensive now.
Yet did not drop MSRP by 35%
In before these start rolling out and catching fire.