Rivian’s critical R2 EV launch begins with a $58,000 model in the spring

Rivian Cars The company announced Thursday that it will launch sales of its all-electric R2 this spring with a special edition worth approximately $58,000.

The first mid-size R2 will be a performance model with a “Launch Package” that includes a range of up to 330 miles, dual engines, special features and “lifetime” access to the advanced driver assistance system Autonomy+. The car will have 656 horsepower and 609 pound-feet of torque, and will be able to accelerate from 0 to 60 mph in 3.6 seconds.

Rivian has been promoting a less expensive version of the car, starting at $45,000, but said that model, which is expected to be less profitable, will not be available until late 2027. Its current vehicles start at more than $70,000.

The R2 is a watershed moment for Rivian after the company lost billions of dollars and saw declining demand for its existing vehicles: the R1 SUV, a pickup truck and an electric delivery van. The R2, from an outside perspective, is essentially a smaller version of the R1 SUV, but the company has reworked the car’s software, electrical system and parts in an attempt to make it more efficient and profitable.

Rivian founder and CEO RJ Scaringe has promised investors that R2 will be a turning point for the company’s profits, sales and technology. The electric car maker also aims to launch hands-free driving to better compete with the leading US electric car maker Tesla.

“R2 is a key transformation vehicle for Rivian to transform into a full-scale automaker, which in turn helps drive operational leverage across the business (including R1),” said Morgan Stanley analyst Andrew Percoco.

Morgan Stanley noted that while it is optimistic about long-term demand for the R2, it remains more “cautious in the near term” as the company transitions to its third-generation electric architecture that will debut in the new car.

Others, such as Barclays, have questioned demand for R2, which Rivian said is expected to anchor its existing factory in Normal, Illinois, as well as an upcoming multibillion-dollar factory in Georgia that is expected to be able to produce up to 400,000 vehicles a year.

“There is increased uncertainty about the R2 volume outlook following recent negative policy developments (e.g., $7.5K IRA credit expiration, lower regulatory appropriations, tariff costs), with the R2 potentially launching in a period of weak EV demand in the US,” Barclays analyst Dan Levy said in an August investment note analyzing potential demand for the vehicle.

In addition to changing federal regulations, such as the end of up to $7,500 in federal tax credits, the R2 comes to market as many automakers are pulling their EV plans or writing off billions of dollars in losses amid slower-than-expected adoption of the vehicles. Analysts also significantly lowered forecasts for market share growth in the coming years.

Scaringe said the company expects the R2 to compete not only with electric vehicles like the Tesla Model Y — the world’s best-selling electric vehicle — but also with traditional gas-powered vehicles.

The R2 is comparable to the Model Y in several key areas. They are similar in size, mileage range and acceleration time. However, the Model Y starts at around $40,000 and already offers many of the driving technologies that Rivian is trying to achieve with the R2.

“R2 is an exceptional vehicle that I believe will be a game-changer for our customers, our company and the industry,” Scaringe said last month during a call with investors about the company’s quarterly earnings results. “The R2 is an extension of the experience we delivered in the R1 with design and performance elements to inspire adventure but in a smaller form factor and, most importantly, at a lower, attractive price.”

Rivian shares rose ahead of the release of R2 details, supported by TD Cowen’s upgrade to buy based on a recent deep dive into new electric vehicle demand trends.

Scarring described 2025 to investors last month as a “founding year” for Rivian, while saying 2026 would mark an “inflection point” for the company.

Rivian’s 2026 guidance includes adjusted pre-tax losses of between $1.8 billion and $2.1 billion and capital expenditures of between $1.95 billion and $2.05 billion. This compares to approximately $2.1 billion in adjusted pre-tax losses and $1.7 billion in capital expenditures last year.

Here are additional details released by Rivian on Thursday about the planned R2 lineup:

• Spring 2026: R2 Performance and Launch Package starting at $57,990. It has all-wheel drive, a range of up to 330 miles, and 656 horsepower and 609 pound-feet of torque.
• Late 2026: R2 Premium, starting at $53,990. It has a dual-motor all-wheel drive setup that produces 450 horsepower and 537 pound-feet of torque and has a range of up to 330 miles.
• First half of 2027: R2 Standard starting at $48,490. It features rear-wheel drive, 350 horsepower, 355 foot-pounds of torque, and a range of up to 345 miles.
• Late 2027: R2 Standard, starting at around $45,000. The company has released limited other details about the model other than that it expects to offer a range of more than 275 miles.