Rivian (RIVN +1.94%) made waves when it went public in 2021. The stock captured investors' attention as support for electric vehicles (EVs) gained significant momentum, and people became optimistic about their growth potential. Fast forward to today, and Rivian's stock is down 92% from its all-time high price in 2021.
It's been a tough backdrop for EV stocks lately, with tailwinds from federal support waning. That said, Rivian boasts a growing lineup of all-electric vehicles, and it is expanding while working to achieve greater cost efficiencies. With the stock priced below $19 per share, is it a buy? Let's dive into the business and find out.
Rivian's growing vehicle and technology platform
Rivian takes a vertically integrated approach to its business, focusing on in-house manufacturing, which includes its proprietary technology platform and software stack. Many of Rivian's components are developed in-house in its Normal, Illinois, facility. This includes electric motors, gearboxes, battery packs, and vehicle electronics, among others.
Image source: Rivian.
Rivian aims to gain a competitive advantage through its technology platform and software stack. Its zonal network architecture and Electronic Control Units (ECUs) are the basis for the vehicle's electrical system. With its full vehicle software stock, Rivian can control and enhance different aspects of the vehicle's software, digital experience, and driving dynamics.
NASDAQ: RIVN
Key Data Points
It also has the Rivian Autonomy Platform, which integrates machine learning and artificial intelligence (AI). Rivian views autonomy as a critical area for transportation and a crucial component for its future sales. Rivian plans to expand its software offerings to include the Rivian Autonomy Platform+, a premium expansion of its automated driver assistance capabilities.
Improving cost structure by scaling manufacturing
One key area for Rivian is its financials. Last year, the automaker lost $4 billion in operations through the first nine months. The company has made some progress this year, shrinking its loss from operations to $2.75 billion through Sept. 30.
Its long-term cost-reduction strategy centers on the development and launch of the Midsize Platform, which underpins the R2 and R3 vehicle lines. This platform is designed to reduce manufacturing complexity and improve cost efficiency compared to the current R1 platform.
Increasing manufacturing volume and optimizing plant operations are other ways it aims to reduce the fixed cost per vehicle. Its future profitability depends on its ability to scale production and delivery operations more efficiently at a lower cost per unit.
RIVN Revenue (TTM) data by YCharts
It currently manufactures vehicles on the R1 and Rivian Commercial Van platforms at its Normal facility, with an installed capacity of up to 150,000 vehicles annually. It plans to integrate the production of its upcoming midsize platform, starting with the R2 vehicle, into the facility.
To prepare for this, upgrades were completed in early October 2025, increasing the total annual plant capacity to 215,000 units. The expanded capacity is expected to be up to 155,000 R2 vehicles, alongside 85,000 R1 vehicles and 65,000 commercial vans. This expansion is expected to lower the fixed cost per vehicle.
A second manufacturing facility, the Stanton Springs North Facility near Social Circle, Georgia, is planned to support demand from the United States and international markets. Construction is expected to begin in 2026, with production anticipated to start on the first manufacturing line in 2028. This facility, designed for an anticipated annual capacity of 400,000 vehicles, is being built in two phases.
Is Rivian a buy?
Rivian is scaling up its business, expanding its platform, and growing its offerings. The company is making progress on improving its costs and bottom-line profitability. Scaling up should help it achieve better economies of scale and improve its profitability and bottom line.
The company noted material cost reductions and a reduced impact from tariffs in the third quarter, which decreased from "a few thousand" per vehicle to "a few hundred." Management expects these savings to extend to its R2 platform and aims to achieve positive gross margins by late 2026.
Rivian is performing well despite the challenging backdrop and headwinds from reduced federal support for EVs, which could impact demand. The company is making progress on improving its cost structure, and its new R2 SUV is expected to boost sales and deliveries next year. With that said, I'd like to see further progress on its bottom line before buying the stock.
