Never heard of Rivian? With its new SUV, the EV brand wants to change that

If you’ve never heard of Rivian, the California-based EV brand wants to change that with the launch of its second-generation vehicle, the R2.

The midsize, five-seat electric SUV is at the heart of Rivian’s strategy to go from a niche, premium brand to a mass-market behemoth in the same league as automakers like Tesla and GM.

“The whole essence of how we’ve designed Rivian has been set up for R2,” RJ Scaringe, Rivian’s founder and CEO, told Morning Brew during an event in Utah this month. “The future of the business is dependent on R2 scaling.”

Deliveries of the R2 begin soon, starting with a launch edition priced around $58,000. By next summer, the company aims to have a $45,000 version in the hands of customers.

The product launch comes as the US EV market navigates choppy waters after the Trump administration killed a $7,500 federal tax credit for EV purchases last fall. But Scaringe insists that with the right product, customers will come—and naturally, he thinks R2 is that product.

“We think R2 is actually gonna capture a significant amount of US market share,” he said, “and be a significant driver of lifting overall market share adoption, in much the same way that Tesla has had that effect with Model 3, Model Y.”

Halo effect

Scaringe founded Rivian in 2009; an IPO in 2021 raised nearly $12 billion, and today Rivian’s market cap is over $21 billion. The company’s initial lineup of vehicles included an electric delivery van, as well as the R1T pickup and R1S SUV. The R1T ranges from nearly $75,000 to over $120,000, while the R1S is priced between roughly $79,000 and $125,000.

“R2 is very different…It’s right in the sweet spot,” Scaringe said. “The average price for a new car in the United States is about $50,000, so suddenly this is the right price point to be mass market in the US market, in the exact right segment.”

Max Koff, R2’s chief engineer, said that “R1’s mission was [to be] this halo product for the brand…For R2, the mission is, how do we bring that Rivian experience to many more customers by providing a more attainable, affordable price point.”

To accomplish this, designers and engineers defined what they saw as Rivian’s brand DNA, and then homed in on four key elements to include in R2: Rivian’s adventurous branding, its class-leading design, making it a fun vehicle to drive, and delivering a software- and AI-defined product.

The company describes R2 as “enjoyably powerful, incredibly capable, thoughtfully designed and software-forward, all in a smaller package and at a more accessible price point.”

One of the key design elements that execs highlighted is a redesigned steering wheel that has haptic “halo” dials that drivers can use to scroll, push, pull, and tilt to control multiple functions, like adjusting the vehicle’s mirrors.

The R2 comes standard with a NACS charging port, giving drivers access to Tesla’s expansive charging network. Rivian also has more than 120 charging sites of its own across the US.

Rivian Autonomy, the company’s end-to-end AI system, comes standard on R2. The company sells access to the system, which today enables hands-free driving on 3.5 million miles of roads in the US and Canada, for a one-time $2,500 fee or $49.99 a month.

And Rivian’s push to expand its outdoor adventure-oriented accessories lineup continues with R2—products available include a rooftop tent and travel kitchen.

The vehicle’s design closely resembles that of the R1S, which analysts said could work in the smaller SUV’s favor.

“That is a critically important decision,” David Undercoffler, head of consumer insights at CarGurus, told us. “The R1 clearly has brand equity around it and consumers appreciate it and respect it, and it’s aspirational. So it would be almost foolish for Rivian to take all of that goodwill and capital and not leverage it for their higher-volume vehicle.”

CarGurus’ data suggests there’s strong demand for used R1 vehicles, which could bode well for R2. The average list price for used R1s on CarGurus is $65,802, compared to $37,632 for non-Rivian EVs. Rivian EVs, meanwhile, are selling in less than 29 days, compared to nearly 37 days for other EVs.

“They’re gonna get this vehicle to people who always thought they were cool,” Undercoffler said, “but never had the stomach or the inclination or the wallet to drop $80,000 on a brand that was fairly new or just a lot of money.”

After driving the R2, Undercoffler said it’s a “very mature product” that iterates on what R1 accomplished.

“You build a compelling vehicle that people are gonna want and the demand will follow. If you build it, they will come,” he said. “I do think that Rivian will see that with the R2, because you get in it and there are not any obvious sacrifices to that vehicle for it being electric.”

Does it pencil?

R2’s material costs are expected to be 45% cheaper compared to the second-generation R1, according to Rivian. Designers and engineers were able to achieve cost reductions by cutting down on the number of parts in the vehicle, for example, as well as having more leverage with suppliers as the company has become a more established manufacturer.

“The underlying importance of R2 isn’t just that it’s smaller and cheaper to buy. It’s supposed to be simpler and cheaper to build,” Paul Waatti, director of industry analysis at automotive marketing research firm AutoPacific, told us. “If Rivian is able to get the cost structure right, R2 could change the company’s financial trajectory. But if it doesn’t, or they have major recalls or high maintenance costs, Rivian may have a popular vehicle that still doesn’t solve the business problem. And then where do they go from there?”

Another key driver of cost savings on R2 is that it’s expected to be a much higher-volume product. Rivian has expanded production capacity at its Normal, Illinois, plant to make as many as 155,000 R2 units per year. This year, the company expects to deliver up to 67,000 vehicles across its R1, R2, and commercial lineups. Rivian also plans to open a plant in Georgia to support future production of R2 and its forthcoming R3 lineup.

“It’s not just about, are they going to be able to sell it? We can already tell that the market has been somewhat receptive to it and seems to like the design and the idea of it,” Waatti said. “It really is the execution that matters here.”

Three things to watch, Waatti said, are how quickly Rivian is able to ramp production, how good the quality is, and if the cost structure works.

“Going from the accounting room to the production floor is a huge difference,” he said.

Going mainstream

Ahead of the R2 launch, Rivian hosted block parties in nine cities across the country to give consumers a chance to engage with the vehicle. The company plans an omnichannel marketing campaign throughout the rest of 2026.

“We are so excited to bring R2 to spaces all over the country, where customers will be able to view the vehicles and take them for test drives,” Jenny Lewis, Rivian’s VP of marketing, said in a statement to Morning Brew. “This is in addition to a multi-channel marketing campaign that will roll out over the next few months to celebrate this major milestone with our community, and invite new customers to start their adventure with us.”

Scaringe expressed confidence that brand awareness will grow organically on the strength of the product.

“Awareness is still nowhere near where we hope it’ll be in a couple years, but we can let awareness grow, because we have so much enthusiasm around what we’re doing,” he said. “In the first year or two, there’s enough people that know about the brand to support our ramp-up, but then word-of-mouth, our own materials, the way we tell stories about the brand, will allow it to methodically become part of a broader awareness for what Rivian does.”

The EV maker already has at least one big customer signed up: Uber has a $1.25 billion deal with Rivian to deploy up to 50,000 autonomous vehicles.

As for retail customers, analysts pointed to customers for models like the Toyota RAV4, Jeep Grand Cherokee, and Subaru Forester as possible conquests for Rivian.

“They’re not just going against Tesla or even just EVs,” Waatti said. “They’re launching into a market and a segment that is just so massive that there’s going to be cross-shoppers from all kinds of different brands that might be interested and maybe weren’t interested in an EV in the first place, but maybe this is the type of vehicle that would resonate with them.”

Undercoffler said Rivian’s pitch to prospective buyers emphasizes that R2 is a “capable, appealing, outdoorsy vehicle first, EV second. It happens to be electric, but it has all these features and this styling and this ethos of the brand.”

It’s crucial that this message resonates, analysts say.

“It’s the most important vehicle they’re gonna launch probably ever,” Waatti said. “R2 is a vehicle that has to prove Rivian can actually scale and make it to the next chapter. It takes Rivian out of that premium adventure niche that it kind of built for itself, and now it’s plunging itself into the larger, more mainstream part of the market.”