Tesla Should Be Worried About Rivian
Can this EV startup come back from the brink and take on Musk?
A few years ago, Rivian shook the EV world when its R1 electric pickup truck beat Tesla’s Cybertruck to market. The R1 was genuinely revolutionary, and many saw Rivian as an up-and-coming Tesla killer. But, since then, Rivian has struggled to reach profitability, and its challenge to Musk appeared to have waned. But, this appearance was misleading. It turns out Rivian has been hard at work in the background, tinkering away and developing models capable of not only taking on Tesla but blowing them away! However, can Rivian really give Musk some sleepless nights?
At a recent launch, Rivian announced its upcoming model, the R2. It’s about the same size as a Model Y but quite a bit more boxy and has far more cargo space. It was pitched as a rugged five-seater “optimised for big adventures,” so its entire interior can fold flat (including front seats), turning it into a two-person camper, and its off-road specific tyres, optional all-wheel drive and high ride height will help it tackle any off-road trail. Furthermore, it also shares the same beautiful yet rugged design inside and out as its older brother, the R1. It also has a structural battery pack, like the Model Y, which makes the car lighter and cheaper to produce.
So, what about the specs and price?
Well, the R2 is set to start at $45,000. It will have two battery sizes and three motor options, including single-motor RWD, dual-motor AWD, and a performance tri-motor configuration with two motors in the rear and one in the front, just like a Model S Plaid. The base trim with the smaller battery and single motor will have a range of 270 miles, but higher-spec large battery pack cars will have ranges of well over 300 miles, and both battery packs can charge from 10% to 80% in under 30 minutes. The top-of-the-range tri-motor R2 will be capable of accelerating from 0 to 60 mph in “under 3 seconds.” Currently, this is all we know about the R2’s specs.
Compare that to the Model Y. Before incentives, the base trim costs $43,990, which gives you 267 miles of WLTP range, a 25-minute 10% to 80% charge time, and less cargo space than the R2. Meanwhile, the top-spec Model Y Performance is noticeably slower, with a 0–60 mph of 3.7 seconds. What’s more, having test-driven several Model Ys and seen one of the few Rivians that have made it to the UK, I can almost guarantee the R2’s interior feel and quality will be a notch above the Model Y.
So, the R2 is about the same price as an equivalent Model Y, with almost exactly the same range and charge times, except it is significantly more practical, way better looking and a good chunk faster.
But that isn’t why Tesla should be worried about the R2.
Firstly, the R2 will be the first Rivian to be sold outside the US, specifically in Europe and the UK. It should also sell well in these markets, as the R2 is the right size for European roads. This larger-scale production should not only help Rivian reach profitability but will also give it the cash flow needed to expand and build more factories worldwide, a crucial step if you want to challenge Tesla.
However, the big reason the R2 could out-sell the Model Y is actually self-driving. You see, the R2 will be equipped with eleven cameras, five radars and a more powerful onboard computer than that in the R1. Meanwhile, the Model Y only has 8 cameras to sense the world around it. As I covered in this previous article, Musk moved Tesla over to visual-only self-driving in 2021 and removed all sensors from the cars, apart from cameras. This move went against advice from his engineers, and many of them have now come forward and publicly stated that the switch made Tesla’s self-driving less capable and less safe. In contrast, the R2, with its greater camera coverage and radar, has the potential to be far more competent and safe than Tesla. Especially when you realise that Consumer Reports ranked the Rivian’s current self-driving abilities marginally behind Tesla’s, meaning this seemingly biennial upgrade with the R2 could actually make it leapfrog Tesla.
Considering the R2 is the same price as the Y, and the general public is starting to wise up to how badly managed Tesla’s self-driving program is, this could be the tipping point that turns Tesla customers into Rivian customers.
But you will have to wait for the R2, as it is slated to start production in late 2026 and will not be on sale in the UK or EU until a few years after that. What’s more, during that time period, the Model Y could have improved significantly or had its price slashed. However, as it stands, the R2 could be one of the most competent Tesla rivals we have ever seen, and it could spell some serious trouble for Tesla.
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Sources: Will Lockett, Top Gear, Autocar, The Verge, Rivian, Autoexpress, Tesla, EV Database, EV Database, Consumer Report