Rivian CEO RJ Scaringe has apologised for pricing increases that “broke the trust” with its customers.
The American electric vehicle startup announced price increases of between 17 and 20 per cent, but applied these pricing changes to all future deliveries including existing pre-orders.
In an open letter, Scaringe acknowledged his company “didn’t manage communications well” and “wrongly decided” to apply the price increases across the board.
Customers with a Rivian pre-order as of the March 1 pricing announcement will have their original configured price honoured.
Customers who cancelled their pre-order on or after March 1 can also have their original configuration, pricing and delivery timing reinstated.
All other customers will pay the new, higher prices.
Models with a new dual-motor powertrain and standard-range battery now assume the price point of the quad-motor, long-range variants Rivian launched the R1T and R1S with, but they won’t be available until 2024.
The R1T pickup range opens at US$67,500 (A$92,237) for the dual-motor Explore, while the R1S SUV opens at US$72,500 (A$99,070) in dual-motor Explore guise.
But the quad-motor powertrain was previously advertised at US$67,500 before its price hike, leading some Rivian customers to accuse the company of bait and switch.
Quad-motor Explore variants of the R1T and R1S are now priced at US$79,500 and US$84,500 (A$108,635 and A$115,467), respectively.
Rivian says the price increases are due to the rising cost of components and materials, including semiconductors, sheetmetal and even seats, with Scaringe citing a 30 per cent increase in the average price of a new car since 2018.
“We failed to appreciate how you viewed your configuration as price locked, and we wrongly assumed the announced Dual-Motor and Standard battery pack would provide configurations that would deliver price points similar to your original configuration,” said Scaringe in the letter.
“While this was the logic, it was wrong and we broke your trust in Rivian.”
“I have made a lot of mistakes since starting Rivian more than 12 years ago, but this one has been the most painful.”
The new standard-range dual-motor variants have an estimated 418km of range. The long-range battery increases this to 514km, while the R1T is exclusively offered with a ‘max pack’ with 643km of range.
Quad-motor R1T and R1S models continue to offer a long-range pack (505-508km based on US EPA testing), while the quad-motor R1T can be had with a max pack with 643km of range.
The dual-motor powertrain is “projected” to offer outputs of over 447kW and 813Nm and a 0-60mph time of “as quick as 4 seconds”.
Rivian says its quad-motor powertrain has a total system output of 622kW of power and 1231Nm of torque, good for a 0-60mph (0-96km/h) time of around three seconds.
Rivian production began late in 2021, and the company is expanding its Normal, Illinois plant that it bought from Mitsubishi in addition to opening a second facility in Georgia.
The company has yet to lock in plans for an Australian introduction, but said in a filing with the US Securities and Exchange Commission that it plans to enter major Asia-Pacific markets, among others.
Keyword: Rivian apologises for price hike, will honour existing pre-order pricing