Rivian CEO RJ Scaringe Pegs Slowdown In EV Sales To 'Truly Extreme' Lack Of Choices Under $50K Due To Automakers 'Unfortunately' Replicating Tesla Model Y's Design: 'That's Very Different From The Internal Combustion Space'
Tesla Inc.’s (NASDAQ:TSLA) rivals have replicated its Model Y in a bid to develop cheaper EVs, resulting in a lack of choice for customers in the U.S. EV market looking for cheaper electric vehicles, according to Rivian Automotive (NASDAQ:RIVN) CEO RJ Scaringe.
What Happened: The slowdown in EV sales, as per Scaringe, is largely owing to the ‘truly extreme’ lack of choice within the U.S. EV market for vehicles priced under $50,000.
“If you want to spend less than $50,000 for an EV, I'd say there's a very, very small number of great products. Tesla Model 3 and Model Y are highly compelling, great products, but they don't have a lot of competition,” Scaringe said in an interview with The Verge.
While other EV makers have tried to make EVs that fit the below $50,000 price range, they “unfortunately” replicated the shape and overall proportions of the Model Y such that it ultimately provides no choice to the customer, the CEO opined.
“Ironically, because of the Model Y's success, you have a lot of incumbents that have built products that look and feel and are shaped a lot like a Model Y. That's very different from the internal combustion space where you have hundreds of choices, lots of brands, lots of variety of form factors,” Scaringe said.
Model Y is Tesla’s best-selling vehicle, seconded by its mass-market sedan Model 3. The Model Y starts at $44,990 for the base version in the U.S. while the Model 3 starts at $38,990.
Why It Matters: Rivian itself is currently gearing up to start production of a smaller, cheaper R2 SUV priced under $50,000, unlike its pricier R1 offerings which start at around $70,000. While the R2, expected to be priced at around $45,000, will compete directly with the Model Y in terms of pricing, it has a very different form. The R2 is a smaller version of Rivian’s R1S SUV, while Model Y is a crossover SUV that largely resembles a car.
“The R2 very intentionally, much like we did with R1, is not trying at all to be a Tesla Model Y. It's going to compete from a price point of view, with very similar pricing. It's a very similar size. It's slightly shorter than a Model Y, but it's not trying to replicate a Model Y,” Scaringe said about the R2’s design. The CEO admitted to having owned a Tesla Model Y before which he termed “an awesome car.”
R2 is expected to go into production in early 2026.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
Read More:
Image made via photos on Flickr and Shutterstock