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Rivian (RIVN) CEO says R2 will be its Tesla Model 3 moment as more affordable EVs are needed

Peter Johnson

Dec 28, 2023

Although Rivian (RIVN) and Tesla have different products, they are more alike than you may think. Rivian’s CEO RJ Scaringe said its upcoming R2 model will be its version of the Tesla Model 3.

It may not look like a Tesla Model 3, but Rivian’s R2 will help shape the EV startup’s future. Like Tesla, Rivian started with more expensive flagship models.

Tesla released the Roadster in 2008, which led to the Model S in 2012. Several years later, Tesla announced its first mass-market electric car, the Model 3.

Although Tesla went through what CEO Elon Musk described as “production hell” ramping up the Model 3, the work paid off. In 2018, Tesla’s Model 3 became the best-selling EV globally, holding the title until the Model Y topped it in 2020.

Tesla’s Model 3 will be among the top-selling vehicles globally (gas or electric) in 2023 as it continues to see strong demand.

Rivian has been ramping production all year. Despite several rivals cutting EV targets, Rivian raised its production goal following strong Q3 results. The EV maker now aims to build 52,000 vehicles this year. That’s more than double the 24,337 it produced last year.

Rivian R2 will be its Tesla Model 3 moment

Like Tesla, Rivian plans to expand into new markets. The automaker chose Clayco as its partner earlier this month to build its massive $5 billion EV plant in Georgia.

The new facility will be home to Rivian’s R2 vehicles. Scaringe previously said R2 will start at around $40,000 to $50,000. Rivian’s R2 will be a mid-size electric SUV.

On the How I Built This podcast with Guy Raz, Scaringe recently spoke about ramping production and expanding the brand, as well as other plans for the future.

When asked if R2 will be Rivian’s version of the Tesla Model 3, Scaringe said that “strategically, it’s very similar.”

Scaringe explained that Rivian started with its flagship R1 products that are intentionally priced higher for their features, capabilities, and more.

Rivian will take the “essence of the brand” represented in those products and build it into more affordable models.

The Rivian R2 is expected to be unveiled for the first time next year before launching in 2026. Construction on the Georgia site will begin soon, with grading work finishing up through the end of the year.

An official groundbreaking ceremony is expected in early 2024. Once the first stage is complete, Rivian expects to be able to build 200,000 EVs a year. By 2030, the EV maker looks to double it.

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