The upcoming Rivian R2 EV, which will be unveiled on March 7, will be eligible for the full $7,500 tax credit, CEO RJ Scaringe said during an interview with Forbes. Currently, the all-electric R1S SUV and R1T pickup are eligible for a $3,750 tax credit when purchasing but only if the MSRP is under $80,000. Leasing, however, unlocks the full credit whatever the MSRP.
But while a $3,750 cut on a car that costs over 70 grand isn’t such a big deal, a $7,500 reduction in price on a car that will probably cost around $45,000 is much more important, representing roughly 16% of the MSRP and bringing it down to a much more palatable (and currently hypothetical) $37,500.
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The Rivian R2 will go toe to toe with the Tesla Model Y, pricing-wise
The upcoming Rivian R2 will be priced somewhere between $40,000 and $60,000. This, coupled with the fact that the battery materials will be sourced so they abide by the Inflaction Reduction Act rules, will make the new R2 eligible for the full $7,500 tax credit when purchasing. That said, the EV is still two years away from being produced.
As luck would have it, the Tesla Model Y, which was the world’s best-selling car last year, is also around $40,000 to $50,000 depending on trim and can benefit from the $7,500 tax credit when purchasing, making it a direct competitor to the new Rivian R2.
When it comes to the pricing strategy, Rivian’s head honcho said during his interview with Forbes that $48,000 is “a really important sweet spot,” and that it’s important for Rivian to be in that space. That figure is roughly the average transaction price of any vehicle in the United States, irrespective of the energy source, so offering an adventure-oriented EV in that price zone is Rivian’s purpose with the R2.
“We think that’s a really important sweet spot, to be in that range, to create a viable option for customers that are coming out of combustion-powered vehicles getting into something very different,” Scaringe said.
Last year, Rivian delivered 50,000 EVs in the United States (R1S, R1T, and Electric Commercial Van combined) and had both the R1T and R1S on the list of the 20 best-selling EVs in the country. However, as the company’s CEO puts it, even with these sales figures, Rivian is still not a mass-market manufacturer, and mass-market is the goal.
The R2, which will go into production sometime in 2026 at a brand-new factory in Georgia, will help Rivian achieve its goal, thanks to a lower price and worldwide availability. Ever since their launch a couple of years ago, the R1T and R1S have only been available in North America, but the R2 will also be sold in Europe and eventually in China, bringing it to a much wider audience.
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