In an online forum of Rivian for their customers, the company announces the cancellation of the R1T Explore model, which is the most affordable truck that they offer. Together with this is the price increase of their base model by over $6,000.
Comparing its price to the expensive model, the Rivian R1T Explore starts at $67,500 while the Adventure is at $73,000. As per their email, customers have the choice to upgrade their orders to the expensive tier that Rivian offers but are also given an option to cancel their order.
Rivian Spokesperson Tanya Miller confirmed to The Verge via email that the reason for discontinuing the package is because the company wants to focus on producing as many vehicles as it can. By giving much attention to the Adventure package, Rivian will 'streamline' its supply chain and will have the capacity to make more vehicles.
Based on the email, the orders for the Explore model were not that much and had 'only a small percentage of customers. Now, if they cancel their pre-orders, the refund will automatically reflect on their accounts, but if the customers choose to upgrade, the price increase will be deducted. Miller also added that there were no Explore packages delivered to its customers before the announcement.
Customers' Reaction
On the Rivian Owners Forum site, a customer expressed his anger regarding the company's price increase as it will add $8,000 to the base price. He explained that the email made them feel totally enraged and let down at the same time.
Last March, an increase of 20% was added to the estimated prices of their vehicles, and customers were also not happy with this as their pre-orders will be more expensive with an additional estimate of $10,000-$20,000. Due to the outrage of its customers, the company withdrew this decision a day later after the announcement and apologized to its customers.
The Company's Financial State
A few weeks ago, reports from several sources claimed that 6% of Rivian employees were laid off, and it estimated up to 14,000 employees. The high inflation rate was the reason for them to cut down its workforce as Rivian has been affected by the increasing interest rates and price increases for the past months.
Despite having 71,000 pre-orders of the R1T vehicles, the company cut its production forecast to 25,000 vehicles, almost half of it, for the year 2022. The layoff will not be affected by this, as Chief Executive RJ Scaringe confirmed.
Together with these problems are the company's reconstruction of their factory as it will affect their financial matters.
Rivian was a well-funded business as it earned almost $12 billion in sales and support aid from different investors such as Ford and Amazon.
Related Article : Rivian Cuts Off 6% Of Its Workforce Due to EV Production Challenges
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Written by Inno Flores
