Can Rivian Turn Around Its EV Struggles in 2025?

The EV maker is at a critical juncture. After a 90% plunge from its 2021 peak, Rivian has managed to recover roughly 36% in stock value over the past year – but the underlying business challenges remain formidable. The real question: can the company’s upcoming product lineup rescue its path to profitability?

The Delivery Dilemma

Numbers tell a sobering story. Rivian wrapped up 2025 with fewer vehicle deliveries than in either of the previous two years, a concerning trend that contradicts growth expectations. In Q3 alone, the company delivered 13,201 units, but Q4 saw a sharp slowdown with just 9,745 vehicles handed over to customers.

The company has yet to match its quarterly delivery peak of 15,564 units from Q3 2023, suggesting production scaling remains challenging despite management promises of capacity expansion.

Margin Math That Doesn’t Add Up Yet

On the positive side, Rivian’s Q3 revenue climbed to approximately $1.56 billion (up 78% year-over-year), and the company posted $24 million in gross profit – a stunning $416 million swing from the prior year’s substantial loss.

Yet this apparent improvement masks deeper problems. Automotive gross margins sit at negative $130 million, meaning the company still loses money on every vehicle sold after accounting for production costs. While this automotive gross loss narrowed by $249 million compared to last year’s Q3, the underlying economics remain upside-down.

The R2 Gamble

Where Rivian is placing its bet: the upcoming R2 lineup. These vehicles, priced at approximately $60,000 for the launch edition with a base model eventually reaching $45,000, represent a dramatic shift downmarket from the current R1 average selling price of $86,500.

The calculus seems straightforward – lower prices should unlock mass-market demand and drive production volumes. Higher volumes theoretically deliver economies of scale. But here’s the rub: introducing lower-margin vehicles into the sales mix could actually depress overall profitability in the near term, even as unit volumes rise.

The Competitive Storm

EV market growth has decelerated significantly since Rivian’s 2021 IPO, and Chinese manufacturers are reshaping the competitive landscape. This external headwind compounds Rivian’s internal challenge: the company must scale production while managing margin compression and facing increasingly aggressive pricing from global competitors.

The Verdict

For investors considering entry now, the calculus remains unfavorable. Rivian faces a narrow window to execute its R2 launch successfully while international competition intensifies. Until the company demonstrates sustained positive margins alongside meaningful delivery growth, the story of a turnaround remains more hope than reality.