Why Rivian is holding the $45,000 base model R2 until ‘late 2027’

Rivian revealed the specs and pricing details for its pivotal R2 SUV on Thursday, and the company also finally answered a long-burning question: When will customers be able to buy the promised $45,000 base model?

That answer is “late 2027,” according to the company’s press materials. And there’s a catch. The language Rivian uses now is that the base model R2 will be “starting around $45,000.” That’s a notable change from how the company was recently promoting that the R2 would be “starting at $45,000″ on its website. (Emphasis mine.)

This is not exactly surprising. As TechCrunch first reported last week, Rivian removed the “starting at $45,000” language from its website in February.

Also, a lot has changed since Rivian first revealed the R2 in March 2024. The $7,500 federal EV tax credit is gone. Legacy automakers have stopped buying regulatory credits from companies like Rivian, effectively ending a stream of what was ostensibly free money pouring into its coffers. President Trump’s chaotic tariffs have increased the cost of components and materials Rivian uses to make its EVs.

In some ways, Rivian has bigger challenges to deal with.

Sales of its R1T pickup truck and R1S SUV declined in 2025. Rivian is about to start constructing a giant factory in Georgia where it expects to build hundreds of thousands of R2 SUVs (and, eventually, R3 hatchbacks).

The company is also trying to architect what would be one of the fastest electric vehicle launches in U.S. history with its more premium R2 models this year. Rivian is projecting sales of between 20,000-25,000 R2s by the end of 2026. If it succeeds, only Tesla’s Model Y would have reached 20,000 in sales faster.

Rivian told TechCrunch it wanted to start with the pricier performance R2 models “so owners can experience the absolute peak of the new platform first.”

“Debuting with a high-spec trim is common industry practice and sets the stage for the entire lineup by showcasing the exceptional capability and acceleration that make a Rivian unmistakable, all while we scale production into our Premium and Standard configurations after,” the company said.

Rivian will offer a “Standard” R2 in the first half of 2027 that starts at $48,490, with a range of up to 345 miles. The true base model will only reach about 275 miles. That could be a sign of how Rivian is reaching the base model price — fewer batteries usually tracks with lower cost. The base model’s more meager range could also serve a dual purpose by encouraging customers to pay up a few thousand dollars more for clearly superior range.

Rivian told TechCrunch the two Standard models share the same rear-wheel drive propulsion, but declined to say whether there are other differences beyond the battery capacity that could explain the price difference. It also declined to comment on its upselling strategies.

“We have made significant internal engineering, development and business efforts to reach our target price. We engineered out complexity by moving to a zonal electrical architecture, reducing the number of electronic control units, and utilizing our in-house drive units,” the company said in a statement. Rivian said it also applied lessons from how it reduced the cost of its second-generation R1 vehicles, and leveraged better supplier relationships.

This all comes just a few months after Rivian agreed to pay $250 million to settle a class action shareholder lawsuit centered around how the company suddenly hiked prices on its R1 vehicles in 2021.

It also has some light echoes of the controversy Tesla waded into a few years ago. Elon Musk and his company had spent years promising the Model 3 would cost $35,000. But Tesla only briefly made a $35,000 Model 3 available “off-menu,” and even that plan didn’t last long. Many of the customers who tried to buy it were pressured into buying higher-trim versions of the sedan, all while Musk publicly complained about how hard it was to fulfill the promise he had made.

Another Tesla vehicle was once announced with an attractive price that never materialized: the Cybertruck. Tesla first pitched the steel-clad pickup in 2019 as starting at just $40,000. But it ultimately launched at much higher prices that, when mixed with its broadly off-putting design, resulted in very meager sales.

It seems unlikely that the R2 would break as bad as the Cybertruck did for Tesla. After all, it’s a far more approachable vehicle that is also starting at much lower price — all without the political cost of having Elon Musk as the CEO. But only the next few years will tell whether the R2’s base model winds up with a life that’s mmore like the $35,000 Model 3, or the Cybertruck, or something completely different.

Topics

Sr. Reporter, Transportation

Sean O’Kane is a reporter who has spent a decade covering the rapidly-evolving business and technology of the transportation industry, including Tesla and the many startups chasing Elon Musk. Most recently, he was a reporter at Bloomberg News where he helped break stories about some of the most notorious EV SPAC flops. He previously worked at The Verge, where he also covered consumer technology, hosted many short- and long-form videos, performed product and editorial photography, and once nearly passed out in a Red Bull Air Race plane.

You can contact or verify outreach from Sean by emailing sean.okane@techcrunch.com or via encrypted message at okane.01 on Signal.

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