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By Chris Kirkham and Abhirup Roy
LAGUNA BEACH, California (Reuters) -Rivian on Thursday unveiled its smaller and cheaper “R2” SUVs and “R3” crossovers amid a slowdown in demand for EVs and likewise stated it might begin producing the R2 at its current facility in Illinois to make sure deliveries in 2026.
Rivian shares have been up 10% at $12.16 on Thursday afternoon.
The R2, with a beginning worth of $45,000, effectively beneath the corporate’s flagship R1 SUVs and pickups, is seen as crucial to Rivian’s success. Excessive rates of interest have led to a pointy slowdown in demand for EVs, that are sometimes extra expensive than gasoline-powered vehicles.
Rivian had beforehand deliberate to provide the R2 at a yet-to-be-constructed $5 billion plant in Georgia however some analysts have questioned the necessity for constructing the manufacturing unit amid slowing demand for EVs.
Rivian stated the choice to provide the R2 at its facility in Regular, Illinois, would assist the corporate ship the automobiles within the first half of 2026, lower the quantity of capital wanted and cut back threat to the launch.
The transfer will assist the corporate save greater than $2.25 billion, it stated, including that it had ample capital to fund operations by the launch of the R2.
The R2 is a five-seater model of the automaker’s bigger R1S SUV and provides greater than 300 miles (483 km) of vary.
Rivian produced 57,232 automobiles final 12 months and stated progress this 12 months can be flat because it tackles slowing demand and a number of weeks of manufacturing downtime to make upgrades supposed to chop prices and enhance margins.
Regardless of the immense reputation of SUVs and pickups in america, ramping up manufacturing and producing demand past the preliminary wave of fans has been an uphill battle.
Providing inexpensive EVs at scale is seen as key to attracting prospects nonetheless unwilling to change over from their cheaper gas-guzzling automobiles.
In a shock transfer, Rivian additionally unveiled its R3 crossover and a extra highly effective R3X variant on Thursday. The R3 might be priced beneath the R2 and launched after that car. The corporate didn’t disclose some other particulars.
A crossover refers to a car constructed on a automobile platform however with elevated experience peak and skill to deal with tough terrain like an SUV.
(Reporting by Chris Kirkham in Laguna Seaside, California, and Abhirup Roy in San FranciscoEditing by Matthew Lewis)
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