On Thursday, Rivian (RIVN.O) unveiled its latest models, the smaller and more affordable electric R2 SUVs and R3 crossovers, with plans to commence production of the R2 at its existing U.S. factory to expedite deliveries in the first half of 2026. Following the announcement, Rivian shares surged by 13.4% to $12.51 as the company highlighted that its new approach would yield savings of over $2 billion.
With a starting price of $45,000, the R2 significantly undercuts Rivian’s flagship R1 SUVs and pickups. This move is considered crucial for Rivian’s success amidst a notable slowdown in demand for electric vehicles due to elevated interest rates. Generally, electric vehicles tend to be pricier than their gasoline-powered counterparts.
Rivian initially intended to debut the R2, a five-seater variant of the manufacturer’s larger R1S SUV boasting over 300 miles (483 km) of range, at a proposed $5 billion facility in Georgia. However, certain analysts have raised doubts regarding the necessity of constructing the factory.
Previously, Rivian had announced that the R2 would be launched in 2026 without providing further details. Yet, on Thursday, the company revealed that by commencing production in Normal, Illinois, it was expediting its timeline to the first half of that year.
“We’re able to expedite our timeline by utilizing our manufacturing capabilities in Normal, leveraging our Illinois facility to introduce the R2 and swiftly bring it to market,” stated CEO RJ Scaringe.
Rivian investor Vitaly Golumb remarked, “This move definitely alleviates some of the ongoing financial strain required for the Georgia plant. I also anticipate that they are exercising caution and may be able to advance the delivery dates even further.”