With shares down by an eyepopping 89% since hitting public markets in late 2021, Rivian Automotive (RIVN 6.19%) has been a punishing investment for many of its shareholders.
But to be fair, the crash was needed to reset expectations and make the stock a realistic reflection of the challenges involved in building a global automotive brand from scratch. In recent months, the narrative has shifted away from Rivian's company-specific problems and more toward the headwinds in the electric vehicle (EV) industry as a whole, as the Trump administration rolls back U.S. government support.
Let's explore how Rivian might navigate these challenges, and potentially emerge stronger than ever over the next five years and beyond.
NASDAQ: RIVN
Key Data Points
The EV crisis has a silver lining
The Trump administration has hit the U.S. EV industry like a wrecking ball, abruptly pivoting from previous, Biden-era policies designed to support the technology. The most significant change was the loss of a $7,500 EV tax credit, which expired in October 2025. Now, electric automakers are reeling from the sudden loss of a key driver of consumer demand.
According to data from Cox Automotive, U.S. EV sales tanked 36% year over year because of the rollback of incentives. That said, the crisis could have a silver lining for Rivian by disproportionately hurting its rivals.
The best example comes from Ford Motor Company, which is responding to the industry weakness by sharply pivoting from fully electric vehicles to battery hybrids. In December, the legacy automaker reported a $19.5 billion asset writedown related to canceled EV models. It also discontinued its fully electric F-150 Lightning, which directly competed with Rivian's R1T in the market for fully electric full-sized pickup trucks.
Even though the overall EV industry is shrinking, a reduction in competition will give Rivian more room to capture market share and establish its brand recognition while long-term consumer tastes are developing. CEO Ryan Scaringe even goes as far as saying the changes are a "win" for his company. The Trump administration's substantial tariffs on imports could also further disincentivize competition from global automakers like Kia and Stellantis, which are also stepping back from planned fully electric models in the U.S. market.
Image source: Getty Images.
Rivian's fourth-quarter earnings will probably disappoint
Rivian isn't directly affected by the loss of the $7,500 tax credit. Its vehicles didn't even qualify for the incentive in 2025 due to failing to meet battery sourcing requirements. That said, the overall reduction in EV industry sentiment has still hurt performance. While the company's fourth-quarter earnings report is expected to be released on Feb. 12, sales data for the period is already available, and the picture isn't pretty.
Deliveries totaled 9,745, which is a 31% year-over-year reduction from the prior-year period. This is a surprisingly poor showing for a company that isn't hugely affected by the change. But management claims the results were in line with expectations and reflect demand being pulled from the fourth quarter to the third quarter, where deliveries jumped 32%.
What will the next five years have in store?
With deliveries down by 31%, Rivian looks unlikely to deliver strong Q4 earnings. But while the near-term situation is challenging, long-term investors have a lot to look forward to from here.
For starters, the company's new R2 SUV is expected to launch this year. With a price tag of $45,000, it will introduce Rivian to the much larger mass market of consumers, which could supercharge growth and hopefully bring it closer to sustainable profitability.
The company's software and services business is another long-term growth driver. This business actually soared over 300% in the third quarter. Over the coming years, it could become a key source of diversification and growth.
With a forward price-to-sales (P/S) multiple of 2.9, shares are reasonably priced considering these potential long-term growth drivers.
