Q3 2025 Rivian Automotive Inc Earnings Call

And thank you for joining us for Arabian third quarter 2025 earnings call today, I'm joined by RJ syringe, our CEO and founder Claire Mcdonald, our Chief Financial Officer, and Javier Gorilla, Our Chief operations Officer.

Before we begin matters discussed on this call, including comments and responses to questions reflect managements views as of today.

We will also be making statements related to our business operations and financial performance that may be considered forward looking statements under federal Securities law.

[Company Representative] (Rivian Automotive): Just before the earnings call, we published and filed our shareholder letter, which includes an overview of our progress over the recent months. I encourage you to read it for additional details around some of the items we will cover on today's call. Following our prepared remarks, we will be taking questions from sell-side analysts. In the interest of keeping the call to one hour, we would ask these analysts to limit any follow-on questions to one. With that, I'll turn the call over to R.J.

Such statements involve risks and uncertainties that could cause actual results to differ materially.

These risks and uncertainties are described in our SEC filings and the shareholder letter we have filed with the SEC.

During this call we will discuss both GAAP and non-GAAP financial measures a reconciliation of historical non-GAAP to GAAP financial measures is provided in our shareholder letter.

R.J. Scaringe: Thanks, Chip. Good afternoon, everyone, and thanks for joining us for today's call. We continue to make progress against our key strategic priorities, including preparation for the launch of R2, and development of our technology roadmap, including autonomy and our vertically integrated hardware and software. As we've stated before, over the long term, we expect the industry to be fully electric, autonomous, and software-defined. I've never been more confident in the opportunity ahead for Rivian than I am today. I firmly believe Rivian's technology, along with our direct-to-consumer ownership experience, positions our company to build a category-defining brand with a strong product portfolio for the US and European markets. One of the key drivers for attracting customers to electric vehicles, and to Rivian's products more specifically, is consumer choice and price point.

Just before the earnings call, we published and filed our shareholder letter, which includes an overview of our progress over the recent months.

I encourage you to read it for additional details around some of the items, we will cover on today's call.

Following our prepared remarks, we will be taking questions from sell side analysts in the interest of keeping the call to one hour. We would ask these analysts to limit any follow on questions to one with that I'll turn the call over to RJ.

Thanks Chip good afternoon, everyone and thanks for joining us for today's call. We continue to make progress against our key strategic priorities, including preparation for the launch of our two and development of our technology roadmap, including our economy, and our Brooklyn agree hardware and software.

R.J. Scaringe: The average new vehicle purchase price in the United States is now just over $50,000, and the most popular configuration is a five-seat SUV or crossover. Given the attractiveness of this addressable market, I believe R2 is addressing the largest market opportunity with the right product. We leveraged the performance, utility, and personality of R1, and refactored it into a smaller SUV at a lower cost. From an R&D perspective, our teams are executing well to ensure the development of R2 remains on track with our plans. We continue to increase the quality and maturity of our design validation builds, positioning us to begin manufacturing validation builds at year-end following the full commissioning of production equipment. We recently completed the construction of our 1.1 million sq ft R2 body shop and general assembly building, and our 1.2 million sq ft supplier park and logistics center.

As we've stated before over the long term, we expect the industry to be fully electric autonomous and software defined I've never been more confident in the opportunity ahead for Vivien than I am today.

I firmly believe <unk> technology, along with our direct to consumer ownership experience positioned our company to build a category defining brand with a strong product portfolio for the U S and European markets. One of the key drivers for attracting customers to electric vehicles and Caribbean products more specifically is consumer choice and price point the <unk>.

Speaker #1: Good afternoon , and thank you for joining us for Rivian's third quarter 2020 earnings call . Today I'm joined by RJ Scaringe , our CEO and founder , Claire McDonough , our chief Financial officer .

Speaker #1: And Javier Varela , our chief operations officer . Before we begin , matters discussed on this call , including comments and responses to questions , reflect management's views as of today .

Average new vehicle purchase price in United States is now just over $50000 and the most popular configuration is a five seater SUV or crossover.

Given the attractiveness of this addressable market I believe our two is addressing the largest market opportunity with the right product, we leveraged the performance utility and personality of our one and re factored into a smaller SUV at a lower cost.

R.J. Scaringe: All shops have started equipment bring-up, and we are in the process of commissioning the robots in the R2 body shop. In addition, we have completed updates to our paint shop that will allow us to increase our total annual plant capacity to 215,000 units. I've been driving an R2 for a while now, and it is incredible. From a performance perspective, it delivers on the adventurous spirit customers expect from Rivian, while also being a great daily driver that will fit so many different use cases for our customers. Looking longer term, we expect to add an additional 400,000 annual units of capacity for R2, R3, and associated variants with our next US manufacturing facility in Georgia. In September, we are honored to be joined by state and local officials for a groundbreaking ceremony.

From an R&D perspective, our teams are executing well to ensure the development of our two remains on track with our plans. We continue to increase the quality and maturity of our design validation builds positioning us to begin manufacturing validation builds at year end following the full commissioning of production equipment.

We recently completed the construction of our $1 1 million square foot or two body shop in General Assembly building and our one 2 million square foot supplier Park in Logistics Center, all shops, who started equipment bring up and we're in the process of commissioning the robots in the auto body shop and.

In addition, we have completed updates to our paint shop that will allow us to increase our total annual plant capacity to 215000 units.

R.J. Scaringe: Our significant investment in the state of Georgia is expected to create 7,500 jobs, as well as billions of dollars of economic benefits to the local community as we expand our US manufacturing and technology footprint. In parallel to the progress we've made in developing R2, we've also continued to invest in our technology, including our hardware, our software, and our autonomy platform. I'm excited to share the progress we're making at our upcoming Autonomy and AI Day on 11 December 2024. Over the longer term, we believe what will differentiate Rivian's autonomous capabilities will be our end-to-end AI-centric approach. With the launch of R2, our growing fleet of customer vehicles will collect real-world driving data, which will complement the data already collected by our second-generation R1 vehicles.

I've been driving in our two for a while now and it is incredible from a performance perspective. It delivers on the adventurous spirit customers expect from ribbon, while also being a great daily driver that will fit in so many different use cases for our customers.

Looking longer term, we expect to add an additional 400000 annual units of capacity for our two or three and associated variance with our next U S manufacturing facility in Georgia.

In September we are honored to be joined by state and local officials for groundbreaking ceremony, our significant investment in the state of Georgia is expected to create 7500 jobs as well as billions of dollars of economic benefits to the local community as we expand our U S manufacturing and technology footprint.

In parallel to the progress we've made in developing our two we've also continued to invest in our technology, including a hardware or software and autonomy platform.

R.J. Scaringe: That data can be used to train our large driving model, which we believe will allow a rapid rollout of updating driving inference models with growing capabilities. In closing, as we look towards 2026, I'm excited about the opportunity ahead for Rivian. I believe our technology and our products will position Rivian as a market share leader over the long term. I want to thank our employees, customers, partners, suppliers, communities, and shareholders for their continued support. With that, I'll pass the call over to Claire.

I'm excited to share the progress, we're making at our upcoming autonomy and <unk> on December 11th.

Over the longer term, we believe what will differentiate <unk> autonomous capabilities will be our end to end AI centric approach with the launch of our to our growing fleet of customer vehicles will collect real world driving data, which will complement the data already collected by our second generation <unk> vehicles.

Claire McDonough: Thanks, R.J., and good afternoon, everyone. As R.J. mentioned, we continue to make progress on our priorities, and I want to thank our team for their continued focus as we drive execution throughout the business. While we face near-term uncertainty from trade, tariff, and regulatory policy, we remain focused on long-term growth and value creation. It's great to see the continued progress in R2 validation and testing. We're also excited to share more about our hardware, software roadmap, and vision in December at our Autonomy and AI Day. Turning to the results for the third quarter, our consolidated revenues were approximately $1.6 billion, and consolidated gross profit was $24 million. Gross profit included $125 million of depreciation and $24 million of stock-based compensation expense. Adjusted EBITDA losses for the third quarter were $602 million. As expected, we saw a quarter-over-quarter step-up in overall operating expenses.

That data can be used to train our large driving model, which we believe will allow rapid rollout of updating driving inference models with growing capabilities.

In closing as we look towards 2026 I'm excited about the opportunity ahead Caribbean I believe our technology and our products will position <unk> as a market share leader over the long term I want to thank our employees customers partners suppliers communities and shareholders for their continued support with that I'll pass the call over to Claire.

Thanks, RJ and good afternoon, everyone. As Archie mentioned, we continued to make progress on our priority and I want to thank our team for their continued focus as we drive execution throughout the business.

We face near term uncertainty from trade tariffs and regulatory policy, we remain focused on long term growth and value creation.

It's great to see the continued progress on our two validation and testing. We're also excited to share more about our hardware and software roadmap and vision in December at our autonomy and AIA.

Claire McDonough: This was driven by elevated R&D investments related to prototyping as we prepare for the launch of R2 and training costs for our autonomy platform. SG&A stepped up, primarily related to the growth of our sales and service infrastructure and team, as well as operating expenses we don't anticipate will be part of our ongoing cost structure. Now, looking at our automotive segment, during the third quarter, we produced 10,720 vehicles and delivered 13,201 vehicles from our manufacturing facility. As we've said previously, we expect Q3 will be our highest delivery quarter for the year, which was the primary driver of the $1.1 billion of automotive revenue. Automotive gross profit in the third quarter was negative $130 million and was negatively impacted by low fixed cost absorption associated with planned shutdown to prepare the Normal plant for R2.

Turning to the results for the third quarter. Our consolidated revenues were approximately $1 6 billion and consolidated gross profit was $24 million.

Gross profit included $125 million of depreciation and $24 million of stock based compensation expense.

Adjusted EBITDA losses for the third quarter were $602 million as.

<unk>, we saw quarter over quarter step up in overall operating expenses.

In parallel to the progress we've made in developing our two we've also continued to invest in our technology, including our hardware or software and autonomy platform.

This was driven by elevated R&D investments related to prototyping as we prepare for the launch of <unk> in training costs for our autonomy platform.

I'm excited to share the progress, we're making at our upcoming autonomy and <unk> on December 11th.

SG&A stepped up primarily related to the growth of our sales and service infrastructure and team as well as operating expenses, we don't anticipate will be part of our ongoing cost structure.

Over the longer term, we believe what will differentiate review into autonomous capabilities will be our end to end AI centric approach with the launch of our to our growing fleet of customer vehicles will collect real world driving data, which will complement the data already collected by our second generation or one vehicles.

Now looking at our automotive segment during the third quarter, we produced 10720 vehicles and delivered 13201 vehicles from our manufacturing facility.

Claire McDonough: Despite this headwind, we saw strong progress in our unit economics with one of the best quarters ever in automotive cost of goods sold per unit delivered, driven by improved material costs. Our software and services segment reported another strong quarter with $416 million of revenue, and $154 million of gross profit. About half of the revenue within software and services was a result of the software and electrical hardware joint venture we created with Volkswagen Group. We also experienced strong growth and gross profit contribution from remarketing, and vehicle repair and maintenance. Looking at our balance sheet, we ended the quarter with approximately $7.1 billion of cash, cash equivalents, and short-term investments. We continue to see improvements in our working capital, primarily driven by our focus on reducing our raw material, work-in-progress, and finished goods inventory levels.

That data can be used to train our large driving model, which we believe will allow rapid rollout of updating driving inference models with growing capabilities.

As we've said previously we expect Q3 will be our highest delivery quarter for the year, which was the primary driver at the $1 $1 billion of automotive revenue.

In closing as we look towards 2026 I'm excited about the opportunity ahead perineum I believe our technology and our products will position <unk> as a market share leader over the long term I want to thank our employees customers partners suppliers communities and shareholders for their continued support and with that I'll pass the call over to Claire.

Automotive gross profit in the third quarter was negative $130 million and was negatively impacted by low fixed cost absorption associated with planned shutdown to prepare the normal plant for our tail.

Thanks, RJ and good afternoon, everyone. As Archie mentioned, we continued to make progress on our priorities and I want to thank our team for their continued focus as we drive execution throughout the business.

Despite this headwind we saw strong progress in our unit economics with one of the best quarters ever in automotive cost of goods sold per unit delivered driven by improved material costs.

While we face near term uncertainty from trade tariffs and regulatory policy, we remain focused on long term growth and value creation. It's.

Our software and services segment reported another strong quarter with $416 million of revenue and $154 million of gross profit.

It's great to see the continued progress on our two validation and testing. We're also excited to share more about our hardware and software roadmap and vision in December at our autonomy and AI day.

About half of the revenue within software and services was a result of the software and electrical hardware joint venture, we created with Volkswagen Group.

Claire McDonough: We continue to expect to receive additional capital of up to $2.5 billion associated with our Volkswagen Group joint venture transaction, $2 billion of which we expect to receive in 2026. Additionally, we continue to partner with the Department of Energy for an up to $6.6 billion loan at a favorable cost of capital. We will update the market as we progress on this important project for the company. Finally, for our guidance, we are reaffirming our 2025 delivery guidance range of 41,500 to 43,500 units. We are reaffirming our 2025 adjusted EBITDA loss guidance range of $2 billion to $2.25 billion, and 2025 capital expenditures guidance of $1.8 billion to $1.9 billion. We continue to expect our gross profit for the full year of 2025 to be roughly break-even. Thank you again to the team for delivering a great quarter.

Turning to the results for the third quarter. Our consolidated revenues were approximately $1 6 billion and consolidated gross profit was $24 million.

We also experienced strong growth in gross profit contribution from our marketing and vehicle repair and maintenance.

Looking at our balance sheet, we ended the quarter with approximately $7 $1 billion of cash cash equivalents and short term investments we continue to see improvements in our working capital primarily driven by our focus on reducing our raw material work in progress and finished goods inventory levels.

Gross profit included $125 million, depreciation and $24 million of stock based compensation expense.

Adjusted EBITDA losses for the third quarter were $602 million as expected we saw quarter over quarter step up in overall operating expenses. This was driven by elevated R&D investments related to prototyping as we prepare for the launch of our <unk> and training costs for our autonomy platform.

We continue to expect to receive additional capital of up to $2 $5 billion associated with our Volkswagen group joint venture transaction $2 billion of which we expect to receive in 2026. Additionally.

Additionally, we continue to partner with the department of energy for an up to $6 6 billion dollar loan at a favorable cost of capital.

G&A stepped up primarily related to the growth of our sales and service infrastructure and team as well as operating expenses, we don't anticipate will be part of our ongoing cost structure.

We will update the market as we progress on this important project for the company.

Now looking at our automotive segment during the third quarter, we produced 10720 vehicles and deliver 13201 vehicles from our manufacturing facility.

Finally for our guidance, we are reaffirming our 2025 delivery guidance range of 41500 to 43500 units. We are reaffirming our 2025 adjusted EBITDA loss guidance range of $2 billion to $2.25 billion and 2020.

Claire McDonough: As we near the end of the year, we look forward to 2026 and remain steadfast in our belief that R2 and our technology roadmap will be truly transformative for our growth and profitability. I would like to turn the call back over to the operator to open the line for Q&A.

As we've said previously we expect Q3 will be our highest delivery quarter for the year, which was the primary driver at the $1 $1 billion of automotive revenue.

Five capital expenditures guidance of $1 8 billion to $1 $9 billion.

Automotive gross profit in the third quarter was negative $130 million and was negatively impacted by low fixed cost absorption associated with planned shutdown to prepare the normal plant for our tail.

We continue to expect our gross profit for the full year of 2025 to be roughly breakeven.

Operator: For the Q&A section of today's session, we will be utilizing the raise hand feature. If you would like to ask a question, click on the raise hand button at the bottom of the screen. Once prompted, please unmute yourself and begin with your question. As a reminder, we ask that you stick to one question and one follow-up. We will now pause a moment to assemble the queue. Thank you. Our first question comes from Emmanuel Rosner, Wolfe Research. Emmanuel, your line is open. Please feel free to unmute yourself and ask your question.

Thank you again to the team for delivering a great quarter as we near the end of the year. We look forward to 2026 and remain steadfast in our belief that arc <unk> and our technology roadmap will be truly transport formative for our growth and profitability.

Despite this headwind we saw strong progress in our unit economics with one of the best quarters ever in automotive cost of goods sold per unit delivered driven by improved material costs.

Our software and services segment reported another strong quarter with $416 million of revenue and $154 million of gross profit.

I'd like to turn the call back over to the operator to open the line for Q&A.

So the Q&A section of today's session, we will be utilizing the raise hand feature.

About half of the revenue within software and services was a result of the software and electrical hardware joint venture, we created with Volkswagen Group.

If you'd like to ask a question click on the right hand button at the bottom of the screen.

Emmanuel Rosner: Great, thank you so much for taking the question. My first one is on, curious if you could characterize the demand environment in the US that you're experiencing on the back of the removal of the consumer tax credits. Obviously, a big portion of industry reports monthly sales, and did so yesterday. For those that are involved in the EV business, there was quite a bit of a drop September into October. Just curious what you've seen and then sort of level of comfort around the demand levels on a go-forward basis.

We also experienced strong growth in gross profit contribution from our marketing and vehicle repair and maintenance.

Once prompted please on mute yourself and begin with your question.

Okay.

As a reminder, we ask that you stick to one question and one follow up.

Looking at our balance sheet, we ended the quarter with approximately $7.1 billion of cash cash equivalents and short term investments. We continue to see improvements in our working capital primarily driven by our focus on reducing our raw material work in progress and finished goods inventory levels.

We will now cause management to assemble the queue.

Thank you.

Our first question comes from.

Emmanuel Rosner Wolfe research.

Your line is open please feel free to Amit yourself and ask your question.

Continue to expect to receive additional capital of up to $2 $5 billion associated with our Volkswagen Group joint venture transaction $2 billion of which we expect to receive in 2026.

Great. Thanks, so much for taking the question.

My first one is on the.

Curious if you could.

<unk> tries to demand environments.

R.J. Scaringe: Thanks, Emmanuel, for the question. We certainly expected to see a pull forward of demand from October into September with the end of the IRA program, and we saw that in September. That pull forward, of course, results in somewhat of a softer demand environment as we look at October. I think that's, as you referenced, I think that's true just across the full space, across the industry, and across multiple different manufacturers. I think it's important, though, that we look out from a longer-term horizon point of view and recognize that ultimately, customers are going to be making decisions around what's the best product for them. We spend a lot of time, I think, often overly focused on electric vehicle sales relative to others.

In the U S that you're experiencing on the back of <unk>.

Additionally, we continue to partner with the department of energy for an up to $6 6 billion dollar loan at a favorable cost of capital we will update the market as we progress on this important project for the company.

The removal of the consumer tax credits, obviously, you're a big portion of industry reports monthly sales ended so.

Yesterday in and for those.

Finally for our guidance, we are reaffirming our 2025 delivery guidance range of 41500 to 43500 units. We are reaffirming our 2025 adjusted EBITDA loss guidance range of $2 billion to $2.25 billion and 2012.

That are involved in the EV business quite a bit of a drop September into October. So just curious what you've seen and then sort of like level of comfort around the.

Demand levels on a go forward basis.

Yeah.

Thanks Emmanuel for quest for the question.

We we certainly expected to see a pull forward of demand from October.

Five capital expenditures guidance of $1 8 billion to $1 $9 billion.

Into September with the end of the IRA program and we saw that in September.

We continue to expect our gross profit for the full year of 2025 to be roughly breakeven.

And that pull forward of course results in somewhat of a softer demand environment as we look at October and I think that's as you referenced I think that's true just across across the whole space across the industry across multiple different manufacturers.

R.J. Scaringe: The way we think about this, in particular with regards to R2, is we need to build the best vehicles and give customers great choices. In the case of R1, we have the best-selling premium SUV sold in the United States. That's for EVs, premium SUVs. We have the best-selling SUV, electric or non-electric, in the state of California. With R2, we're really hoping to capture the magic of what is in R1 in terms of performance, features, capabilities, and a much more cost-effective or affordable package that allows us to have this vehicle be cross-shopped with so many different types of vehicles. It's hitting the most popular segment with midsize SUV, five-passenger SUV, with a price point that starts at $45,000. The average price of a new vehicle sold in the United States is around $50,000.

Thank you again to the team for delivering a great quarter as we near the end of the year. We look forward to 2026 and remain steadfast in our belief that <unk> and our technology Road map will be truly transformative for our growth and profitability.

I think it's important that we look out from a longer term horizon point of view and recognize that.

I'd like to turn the call back over to the operator to open the line for Q&A.

Ultimately customers are making decisions around what's the best product for them.

So the Q&A section of today's session, we will be utilizing the Raytheon feature.

And we spent a lot of time I think often overly focused on electric vehicle sales relative to others.

If you'd like to ask a question click on the right hand button at the bottom of the screen.

The way, we think about this in particular with regards to <unk>.

Once prompted please on mute yourself I'm begin with your question.

Two is we need to build the best vehicles and give customers great choices.

As a reminder, we ask that you stick to one question and one follow up.

And so in the case of our one we have the best selling premium SUV sold.

We will now pause.

In the United States.

To assemble the queue.

Thank you.

For Evs premium Suvs, and we were the best selling SUV.

Our first question comes from Emmanuel Rosner Wolfe research.

Electric or non electric in the state of California.

R.J. Scaringe: We're really bullish, really confident on R2 and what that represents for us as a business.

And with our two we're really hoping to capture the magic of what is in our one in terms of performance features capabilities and a much more cost.

Manuel Your line is open please feel free to Amit yourself and ask your question.

Oh, great. Thanks, so much for taking the question.

Emmanuel Rosner: Okay, great. As a quick follow-up, what are you expecting in terms of demand for regulatory credits? I don't believe you're assuming any additional sales this year, but any directional view into 2026?

My first one is on.

Cost effective or affordable package that allows us to have this vehicle would be cross shop with so many different types of vehicles and it's hitting the.

Curious if you could take.

Characterize the demand environment.

In the U S. That's you're experiencing on the back of <unk>.

The most popular segment with mid sized SUV five passenger SUV.

The removal of the consumer tax credits, obviously, you're a big portion of industry reports monthly sales and did so.

Claire McDonough: Thanks, Emmanuel. We don't expect to have meaningful revenues from the sale of regulatory credits. We've taken those out of our forecast, just given some of the uncertainty on potential policy changes. We wanted to make sure that our forecast was conservative on this front.

With a price point that starts at <unk> 45, the average price of new vehicles sold me and I'd say its around 50. So we're really bullish really confident on our two and what that represents for us the business.

Yesterday, and then and for those that.

That are involved in the EV business, though quite a bit of a drop September into October. So just curious what you've seen and then sort of like level of comfort around the demand.

Okay, Great and then as a quick.

Follow up.

Emmanuel Rosner: Great, thank you.

What are you expecting in terms of demand for our regulatory credits I don't believe youre, assuming any additional sales this year, but.

Demand levels on a go forward basis.

Operator: Thank you. Our next question comes from Mark Delaney with Goldman Sachs. Mark, your line is open. Please feel free to unmute and ask your question.

Thanks Emmanuel for quest for the question.

Any directional view into 2026.

We certainly expected to see a pull forward of demand from October.

Thanks, Danielle we don't expect to have meaningful revenues from the sale of regulatory credits, Inc. And we've taken those out of our forecast.

Mark Delaney: Yes, good afternoon. Thank you very much for taking the question. COGS per car meaningfully, I think it came down to about $96,000 per vehicle, even with the downtime that companies take to get the Normal site ready for R2. I think, Claire, you mentioned material costs as one of the key drivers of that, but I was hoping you could speak a bit more on what you're seeing in terms of COGS per vehicle. I guess ultimately, any change in where you think costs can get to, especially as you look out to R2?

Into September with the end of the IRA program and we saw that in September.

And that pull forward of course results in somewhat of a softer demand environment as we look at October and I think that's as you referenced I think that's true just across across the whole space across industry and across multiple different manufacturers.

Just given some of the uncertainty on potential policy changes, we wanted to make sure that our forecast was a conservative on this front.

Great. Thank you.

Thank you.

I think it's important that we look out from a longer term horizon point of view and recognize that.

Our next question comes from Mark Delaney with Goldman Sachs.

Mark Your line is open please feel free to Amit and ask a question.

Claire McDonough: Thanks for the question, Mark. As you noted, we had about $96,300 of cost of goods sold per unit delivered in Q3. That was despite the fact that we had several weeks of downtime, so there was an impact from fixed cost absorption included within these results. As we look forward, the big driver of performance improvement in terms of our cost of goods sold in 2026 will be the volumes that we'll receive from R2's ramp and scaling efforts. We'll see benefit not just with R2's path to positive gross profit and positive unit economics, which we expect to achieve by the end of 2026, but also the volume impacts that will benefit both R1, as well as our commercial vans, as volumes scale throughout the Normal facility as a whole.

Ultimately customers are making decisions around what's the best product for them and we spent a lot of time I think often overly focused on electric vehicle sales relative to others in the.

Alright, yes, good afternoon, and thank you very much for taking the question.

Oxford <unk>.

Meaningfully I think it came down to about $96000 per vehicle, even with the downtime the company JJ again, Scott at normal site ready for <unk>.

The way, we think about this in particular with regards to <unk>.

Two is we need to build the best vehicles and give customers great choices.

Sir you mentioned material costs, one of the key drivers of that but I was hoping you could speak a bit more on what youre seeing in Europe per vehicle I guess ultimately any change in where you think costs can get you, especially as you.

And so in the case of our one we have the best selling premium SUV sold.

In the United States.

For Evs premium Suvs, and we were the best selling SUV.

Look out to <unk>.

Thanks for the question Mark and as you noted we had about 96.3 K or cost of goods sold per unit delivered in Q3 and that was despite the fact that we had several weeks of downtime. So there is an impact from fixed cost absorption included within these results.

Electric or non electric in the state of California.

And with our two we're really hoping to capture the magic of what is in our one in terms of performance features capabilities and a much more cost.

Cost effective or affordable package that allows us to have this vehicle would be cross shop with so many different types of vehicles and it's hitting the.

So we look forward the big driver of performance improvement in terms of our cost of goods sold.

The most popular segment with midsize SUV bypass stress should be.

Hi.

Mark Delaney: Thanks. My other question was on Mind Robotics. You mentioned doing work with Mind Robotics, but also bringing in external financing. Maybe just talk a bit more about what Mind Robotics does and what kind of opportunity you see for the entity going forward. Thank you.

In 2026 will be the volumes that will be from our teams ramped and scaling efforts. So we will see benefit not just with.

With a price point that starts at 45, the average price of new vehicles sold me and I'd say its around 50. So we're really bullish really confident on our two and what that represents for us the business.

Our accused path to positive gross profit and positive unit economics, which we expect to achieve by the end of 2020.

Okay, Great and then as a quick <unk>.

Follow up.

What are you expecting in terms of demand for our regulatory credits I don't believe you're assuming any additional sales this year, but.

But also the volume impacts that will benefit both our one as well as our commercial vans as volume scale throughout the normal facility as a whole.

R.J. Scaringe: Mark, this is an area we've spent a lot of time on as a company thinking around, and thinking about, I should say, what does our manufacturing infrastructure and manufacturing platforms look like long-term? As we thought through that, it led us to the view that we need to develop products and robotic solutions that can allow us to run and operate our manufacturing plants more efficiently. The design of these robotic solutions, capturing the data that we have within our existing facilities to train the robotic platforms on manufacturing and to train on some of these high-dexterity operations. We've ultimately raised $110 million in a seed round to launch this as an effort outside of Rivian, but obviously with Rivian still as a close partner and as a shareholder in this entity. The applications will include Rivian applications, but also much wider ranging.

Any directional view into 2026.

Thanks, Emmanuel we don't expect to have meaningful revenues from the sale of regulatory credits, Inc. And we've taken those out of our forecast.

Thanks, and then my other question was on minded Robotics, you mentioned <unk>.

Robotics and also bringing in external financing.

Just given some of the uncertainty on potential policy changes, we wanted to make sure that our forecast was a conservative on this front.

Thanks, guys.

And do you see.

Entergy of my heart. Thank you.

Yeah.

Great. Thank you.

Okay.

Mark This is an area. We've spent a lot of time on as a company thinking around and thinking about I should say what does our manufacturing infrastructure.

Thank you.

Our next question comes from Mark Delaney with Goldman Sachs.

Mark Your line is open please feel free to Amit and ask your question.

And manufacturing platform, which looked like long term and as we thought through that.

Hi, Yes, good afternoon, and thank you very much for taking the question.

Let us to the view that we need to develop.

Oxford.

Meaningfully I think it came down to about $96000 per vehicle, even with the downtime that company Jake Jake scatter normal site ready for <unk>.

Products and robotics solutions bank allow us.

To run and operate our manufacturing plants more efficiently.

Sir you mentioned material costs is one of the key drivers of that but I was hoping you could speak a bit more on what youre seeing and hearing per vehicle I guess ultimately any change in where you think costs can get to you, especially as you.

And the design of these robotic solutions.

<unk> the data that we have within our existing facilities to train.

R.J. Scaringe: Thinking about essentially a wide spectrum of industrial applications where we see the benefit of AI-enabled robotics.

Well go to <unk>.

The robotic platforms on manufacturing and to train on some of these high Tech started operations and so we've ultimately raised $110 million in our seed round to launch this isn't an effort outside of revision, but obviously with reveal installed a post partner and as a as a shareholder in this entity.

Thanks for the question Mark and as you noted we had about $96 three K of cost of goods sold per unit delivered in Q3 and that was despite the fact that we had several weeks of downtime. So there is an impact from fixed cost absorption included within these results.

Operator: Thank you. Our next question comes from George Gianarikas with QR code. George, your line is open. Please feel free to unmute and ask your question.

But the applications will include Vivian applications, but also much wider ranging so thinking about.

George Gianarikas: Hi, everyone. Thank you so much for taking my questions. Maybe you could just update us a little bit on the Volkswagen relationship, just because there are lots of headlines as to what's going on there internally. Any update there would be very much appreciated. Thank you.

As we look forward the big driver.

Performance improvement in terms of our cost of goods sold.

Essentially a wide spectrum of industrial applications, where we see the benefit of AI enabled robotics.

Hi.

In 2026 will be the volumes that we'll receive from our teams ramped and scaling efforts. So we will see benefit not just with our Qs path to positive gross profit and positive unit economics, which we expect to achieve by the end of 2026, but also the volume impacts that will benefit both our one as well.

Thank you.

R.J. Scaringe: The Volkswagen relationship, quite suddenly, is coming up in terms of the joint venture on the one-year anniversary. A lot has happened in the last year. We continue to make great progress. We have an incredibly productive and strong relationship with Volkswagen Group. I was just in Munich a few months ago for a number of different product reveals, one of which was the Volkswagen ID.1, which is a roughly $22,000 EV that's being developed by Volkswagen and, of course, leveraging our technology platform. It's just an awesome vehicle. I'm really excited for that to be one of the launch vehicles that comes out of our collaboration and joint venture with Volkswagen. It's the first of what will be many programs that come out of this joint effort. The relationship remains very strong, very positive, and there are lots of.

Our next question comes from George <unk>.

With Canaccord.

George Your line is open please feel free to on mute and ask two questions.

Our commercial vans as volume scale throughout the normal facility as a whole.

Hi, everyone. Thank you so much for taking my questions.

Maybe you could just update us a little bit on the on the Volkswagen relationship just because there are lots of headlines as to what's going on there internally.

Thanks, and then my other question was on minded Robotics, you mentioned doing work with buying robotics, but also bringing in external financing, maybe just talk a bit more about what might be an opportunity you see for <unk>.

Any update there would be very much appreciate it. Thank you.

Neither the Volkswagen relationship when somebody is coming up in terms of the joint venture on the one year anniversary and.

Thank you.

Yeah.

Yeah. Mark this is an area. We've spent a lot of time on as a company thinking around and thinking about I should say what does our manufacturing infrastructure.

You know it's a lot has happened in the last year, we continue to make great progress with our incredibly productive and strong relationship with Volkswagen group.

And manufacturing platforms look like long term and as we thought through that.

I was just in Munich, a few months ago.

It led us to the view that we need to develop products and robotics solutions bank allow us.

For a number of different product reveals one of which was the Volkswagen I'd, one which is a roughly $22000 EV that's being developed by Volkswagen.

R.J. Scaringe: Things to come in front of us in terms of products and other ways we can work together.

To run and operate our manufacturing plants more efficiently.

Of course, leveraging our technology platform and it's just an awesome vehicle I'm really excited for that to one of the launch vehicles that comes out of our collaboration and joint venture with Volkswagen, but it's the first of what will be many programs that come out of this this this joint effort.

George Gianarikas: Thank you. Maybe as a follow-up, I don't mean to front-run the autonomy day in December, but what role do you see Rivian playing in the robotaxi market? There are some of your peers also developing electric vehicles that have teamed up with some of the rideshare companies. Any sort of anything you could share on that front? Thank you.

And the design of these robotic solutions.

Capturing the data that we have within our existing facilities to train.

The robotic platforms on manufacturing and to train on some of these high Tech started operations and so we've ultimately raised $110 million in our seed round to launch this isn't an effort outside of revision, but obviously with <unk>. So as a post partner and as a as a shareholder in this entity.

And so the relationship remains very strong very positive and there are lots of.

R.J. Scaringe: I mean, a lot of emphasis has gone on the robotaxi side. I think independent of whether the application is in a personally owned vehicle or in a robotaxi, I think really important is recognition that the technology is going to become really a key part of our automotive ecosystem. In our view, as we look towards the end of this decade, it will start to become really an important driver for consumer purchase decisions around whether or not a vehicle is capable of driving itself with both hands off the wheel and eyes off the road, but importantly, doing that across a very wide spectrum of roads. Essentially, any drivable road should be something that can be driven by a vehicle without a lot of involvement from the driver.

Lots of things to come in front of us in terms of products and other ways. We can work together.

But the applications will include Libyan applications, but also much wider ranging so thinking about essentially a wide spectrum of industrial applications, where we see the benefit of AI enabled robotics.

Thank you and maybe as a follow up I don't mean to front run the autonomy day.

In December but what role do you see Arabian playing in the Robo taxi market. There. Some of your peers are also developing electric vehicles that have teamed up with some of the rideshare companies any sort of anything you could share on that front. Thank you.

Thank you.

Next question comes from George <unk>.

I mean, there's a lot of a lot of emphasis has gone on a robo taxi side I think.

With kind of cool.

George Your line is open please feel free to Amit and ask two questions.

Independent of whether the application is in a personally owned vehicle than a robo taxi.

Everyone. Thank you so much for taking my questions.

Didn't really important is recognition that the technology is going to become really a key part of our automotive ecosystem and so in our view as we look towards the end of this decade.

Maybe you could just update us a little bit on the on the Volkswagen relationship just because there are lots of headlines as to what's going on there internally.

R.J. Scaringe: As it stands today, more than 95% of the miles driven in the United States are in personally owned vehicles, the remainder being a mix between taxi, rideshare, and rental. We think that that's likely to stay mostly the same. Maybe rideshare grows by some percent, but we think in terms of large-scale adoption of autonomy, it's going to be solving this for personally owned vehicles that's going to drive the biggest step change for us. Now, saying that, the opportunity for us to participate in robotaxis, it's, of course, there. It's something that if we chose to partner with some of the big rideshare operators, there's lots of market opportunities there. Our focus today is really on the technology, and that's what we'll spend, as you said, George, we'll spend our autonomy and AI day really talking about the technology roadmap, how we've developed it.

Any update there would be very much I appreciate it. Thank you.

It will start to become really an important driver for consumer purchase decisions around whether out of vehicles capable of driving itself with both hands off the wheel and eyes off the road.

Neither the Volkswagen relationship when somebody is coming up in terms of the joint venture on the one year anniversary and it's.

But importantly doing that.

A lot has happened in the last year, we continue to make great progress with our incredibly productive and strong relationship with Volkswagen group.

Across a very wide.

Spectrum of roads, so essentially.

Any drivable road should be something that can be driven by a vehicle with.

I was just in Munich, a few months ago.

A lot of involvement from the driver.

And as it stands today more than 95% of the miles driven United States or in personally on vehicles, the remainder being a mix between taxi ride share and rental.

For a number of different product reveals one of which was the Volkswagen I'd, one which is a roughly 22000 dollar EV that's being developed by Volkswagen.

Of course, leveraging our technology platform and it's just an awesome vehicle I'm really excited for that to one of the launch vehicles that comes out of our collaboration and joint venture with Volkswagen, but it's the first of what will be many programs that come out of this this this joint effort.

We think that that's likely to save.

Mostly the same you know maybe maybe a rideshare grows by 7%, but we think in terms of large scale adoption of autonomy, it's going to be solving this for personally owned vehicles, that's going to drive to.

R.J. Scaringe: That's both the hardware, the software, our data flywheel. Of course, we'll demonstrate what all those different elements come together to enable in terms of what the vehicle can do. I think through that event, you'll see there's lots of different ways this can be applied in terms of go-to-market, whether that's personally owned, or whether that's through robotaxi partnerships, as you stated.

The biggest step change for us now, saying that the opportunity for us to participate in Robo taxis.

And so the relationship remains very strong very positive and there are lots of.

Of course, there is something that if we chose to.

Lots of things to come in front of us in terms of products and other ways. We can work together.

Partner with some of the big Rideshare operators yet.

There's lots of market opportunities there, but our focus today is really on the technology and that's what we'll spend it as you said George we will spend our autonomy nowadays really talking about the technology roadmap, how we've developed it.

Thank you and maybe as a follow up I don't mean to front run the autonomy day.

In December but what role do you see a arabian playing in the robo taxi market. There. Some of your peers are also developing electric vehicles that have teamed up with some of the rideshare companies any sort of anything you could share on that front. Thank you.

George Gianarikas: Thank you.

The hardware the software our data flywheel.

Operator: Our next question comes from Joseph Spak with UBS. Joseph, your line is open. Please feel free to unmute and ask your question.

Of course, we'll demonstrate.

What all of those different elements come together to enable in terms of what the vehicle can do and.

I mean, a lot of a lot of emphasis has gone on a robo taxi side I think.

Joseph Spak: Thanks. Good afternoon. RJ, the CEO of Scout Motors recently reportedly said that 80% of their pre-orders are for their EREV variant. You have BYD, which has both a BEV portfolio and an EREV portfolio. Even if you look at China overall, in recent years, EREVs have been growing, arguably faster. There's clearly demand for that type of product. I think there's probably some benefits to that type of powertrain for the vehicles you want to sell, meaning trucks. Maybe you disagree. I'd be curious to hear that. I know you talk about this all-electric future you envisioned, but the question is, would you actually consider offering an EREV for the US market or globally? If so, how easy is it to adjust the platform?

And I think through that event and Youll see theres lots of different ways. This can be applied in terms of go to market.

Independent of whether the application is in a personally owned vehicle than a robo taxi.

It's personally owned or whether that's through robo taxi partnerships because you.

Really important is recognition that the technology is going to become really a key part of our automotive ecosystem and so in our view as we look towards the end of this decade.

As you stated.

Thank you.

Our next question comes from Joseph Spak with UBS.

It will start to become really an important driver for consumer purchase decisions around whether out of vehicles capable of driving itself with both hands off the wheel and eyes off the road.

I'm curious if your line is open please feel free to Amit and ask your question.

Thanks, Good afternoon RJ.

But importantly doing that.

Yeah, Scott Motors was recently reportedly said that 80% of their preorders are further he ran variant and BYD has both a bev portfolio and <unk> portfolio and even if you look at China overall in recent years Europe's have been growing.

Across a very wide.

Spectrum of roads, so essentially.

Any drivable road should be something that can be driven by a vehicle with.

A lot of involvement from the driver.

And as it stands today more than 95% of the miles driven United States or in personally on vehicles, the remainder being a mix between taxi ride share and rental.

Arguably faster so there's clearly demand for that type of product.

R.J. Scaringe: Thanks, Joe. We're not planning to offer an EREV or effectively a series hybrid, which would involve putting an engine into the vehicle. That's not in our product roadmap or something that we're at all contemplating. I do think it's important to note that part of the journey of electrification is providing customers with choice. Different manufacturers are going to make different decisions on this. Some will decide to take more of a hybrid approach or an EREV approach. Others are going to take a pure EV approach. In the end, asymptotically, this is all going to be driving towards, in our view, as I said in my opening remarks, we believe everything will be electric, everything will be software-defined, and everything will have very high levels of autonomous capabilities. We're very focused on continuing to lead with electrification.

I think theres, probably some benefits of that type of.

We think that that's likely to save.

Powertrain for the vehicles, you want a shallow meaning trucks. So maybe you disagree I'd be curious to hear that but.

Mostly the same you know maybe maybe a rideshare grows by 7%, but we think in terms of large scale adoption of autonomy, it's going to be solving this for personally owned vehicles, that's going to drive to that.

I know you talk about this all electric future you envision but the question is would you actually consider.

The biggest step change for us now, saying that the opportunity for us to participate in Robo taxis.

Offering and he arrived for the U S market.

Or globally and if so how easy is it to just the platform.

Of course, there is something that if we chose to.

Partner with some of the big Rideshare operators.

Thanks, Joe Yeah, we're not we're not planning.

There's lots of market opportunities there, but our focus today is really on the technology and that's what we will spend as you said George we'll spend our autonomy nowadays really talking about the technology Road map, how we've developed it.

To offer a new wherever.

Effectively a series hybrid which would involve putting an engine into the vehicles, that's on and our product road map or something that.

But we're at all contemplating.

But I do think it's important to note that part of the journey of electrification is providing customers with choice.

Both the hardware the software our data flywheel.

Of course, we'll demonstrate.

R.J. Scaringe: We think particularly for the midsize segment SUV, which is going to make up the vast majority of our volume with the launch of R2 and then its follow-on product with R3. That segment really works beautifully with a fully electric architecture where we're able to deliver great performance, outstanding range, and at a price point that's very comparable to ICE or hybrid alternatives.

So different manufacturers are going to make different decisions on this some will decide to take more of a hybrid approach.

But all of those different elements come together to enable in terms of what the vehicle can do.

And I think through that event Youll see theres lots of different ways and this can be applied in terms of go to market, whether it's personally owned or whether that's through robo taxi partnerships as you as you stated.

Or any rough approach others are going to take a pure EV approach.

And in the end as <unk>. This is all going to be driving towards and our view is as I said in my opening remarks, we believe everything will be electric everything will be software defined and everything will have very high levels of autonomous capabilities.

Thank you.

Our next question comes from Joseph Spak with UBS.

And so we're very focused on continuing to lead with electrification, we think particularly for the mid sized segment SUV, which is going to make up the vast majority of our volume with the launch of our two and then its follow on product with our three.

Your line is open please feel free to Amit and ask your question.

Joseph Spak: Thank you. As a second question, I know you spoke briefly on Mind. I guess I just want to, one, there's no spend or has there been spend already going on for that? Two, how should we think about that spend going forward? Is it all ring-fenced in this sort of external company of which you're just an owner? Maybe just if you could clarify that for us, that would be helpful. Thanks.

Thanks, Good afternoon RJ.

Scott Motors.

Reportedly said that 80% of their preorders are further he ran variant.

That the that segment really works.

It works beautifully with an electric car a fully electric architecture, where we're able to deliver.

BYD has both a bev portfolio and <unk> portfolio and even if you look at China overall in recent years Europe's had been growing arguably.

<unk> performance outstanding range and at a price point, that's very comparable to ice or hybrid alternatives.

Arguably faster so there's clearly demand for that type of product.

R.J. Scaringe: Yeah. Mind Robotics is a separate company from Rivian. Rivian is a shareholder in this. The $110 million that I referenced before is the seed financing for it. Is capital from outside of Rivian. I mean, we're incredibly excited about it. I think as much as we've seen AI shift how we operate and run our businesses through the wide-ranging applications for LLMs, the potential for AI to really shift how we think about operating in the physical world is, in some ways, unimaginably large. That influences how we think about designing logistics inside of a plant. It influences how we think about designing even plant layouts.

I think theres, probably some benefits to that type of powertrain.

Okay. Thank you.

Second question.

Powertrain for the vehicles, you want a shallow meaning trucks. So maybe you disagree I'd be curious to hear that but I know you talk about this all electric future you envision.

I know you spoke briefly on on behind.

I guess I just want to under one Theres no spat or has there been spent already going on for that.

Question is would you actually consider.

Two how do you how do how should we think about that spend going forward or is it all breakfast ring fenced and that's sort of.

Offering and he arrived for the Europe question.

Our kit.

Or globally and if so how easy is it to adjust the platform.

External company of Whats your just an owner.

Maybe just if you could clarify that for us that'd be helpful. Thanks.

Thanks, Joe Yeah, we're not we're not planning.

The offer and the river.

Just remind robotics as a separate company from Arabian remains a shareholder in this the $110 million that I referenced before is the seed financing for it.

Effectively a series hybrid which would involve putting an engine into the vehicles, that's on and our product road map or something that.

But we're at all contemplating.

As capital from outside of ribbon.

But I do think it's important to note that part of the journey of electrification is providing customers with choice.

And we're I mean, we're incredibly excited about it I think the the as much as we've seen a shift how we operate and run our businesses.

R.J. Scaringe: The creation of this company is ultimately the culmination of us coming to the view that we wanted to have direct control and direct influence over the design and development of advanced AI robotics that would be very focused on industrial applications. These are robotic solutions we will be creating through this entity, through Mind Robotics, that are designed and optimized around manufacturing and industrial environments.

So different manufacturers are going to make different decisions on this some will decide to take more of a hybrid approach.

Through the the wide ranging applications for LMS.

And have you ever approach others are going to take a pure EV approach.

The potential for AI to really shift how we think about operating in the physical world as is.

And in the end as <unk>. This is all going to be driving towards and our view is as I said in my opening remarks, we believe everything will be electric everything will be software defined and everything will have very high levels of autonomous capabilities.

Some ways unimagined really large and so that influences how we think about designing logistics inside of a plant. It influences. How we think about designing even plant layouts and so the accretion is company is ultimately the culmination of us coming to the view.

And so we're very focused on continuing to lead with electrification, we think particularly for the midsized segment, SUV, which is going to make up the vast majority of our volume with the launch of our two and its follow on product with our three.

Operator: Thank you. Our next question comes from Dan Levy with Barclays. Dan, your line is open. Please feel free to unmute and ask your question.

That we wanted to have direct control and direct influence over the design and development of advanced AI robotics that would be very focused on <unk>.

That segment really works.

Dan Levy: Hi. Good evening. Thank you for taking the questions. I wanted to ask if you could possibly give us the latest update on tariffs within the results. I know you had stockpiled batteries, so I do not know if there is any impact there, but we have seen some changes in tariff policy. Maybe just broadly on tariffs, given IRA is no longer really a consideration, how does that change the battery sourcing strategy for R2? Can you rely perhaps on some of the cheaper LFP batteries from overseas?

It works beautifully with an electric car a fully electric architecture.

Industrial applications and so these are you know.

Robotic solutions, we will be creating through this entity through mind robotics.

We're able to deliver.

Great performance outstanding range and at a price point, that's very comparable to ice or hybrid alternatives.

That are designed and optimized around manufacturing and industrial environments.

Okay. Thank you.

Second question.

Thank you.

I know you spoke briefly on on mind.

Our next question comes from Dan Levy with Barclays.

I guess I just want to understand why there is no spat or has there been spent already going on for that.

Your line is open please feel free to Amit.

Jim.

Hi, good evening, Thank you for taking the questions.

Two how do you how should we think about that spend going forward or is it all breakfast ring fenced and that's sort of.

I wanted to ask if you could.

Possibly give us the latest update on.

External company of Whats your just an owner.

Tariffs within the results I know you had stockpiled batteries. So I don't know if there is.

Maybe just if you could clarify that for us that'd be helpful. Thanks.

Claire McDonough: Thanks for the question, Dan. As you mentioned, the administration announced the lengthening of the 3.75% MSRP offset for Section 232 automotive tariffs to 2030 last week. It also included the ability to designate parts in the 232 automotive classification that expands the pool of eligible parts, which is particularly important for a company like Rivian, which is heavily vertically integrated. Today, we source a lot of raw material inputs that we're building sub-assemblies of internally that weren't previously necessarily designated under a Section 232 classification. We're really appreciative of the administration for these new changes that were announced most recently. As you think about the impacts on the quarter itself, based off of the product that we sold, we were just under the couple thousand dollars per vehicle of impact in Q3.

Just remind robotics as a separate company from Arabian remains a shareholder in this.

Any impact.

There, but we have seen some changes in tariff policy and then maybe just broadly on tariffs given.

$110 million that I referenced before is the seed financing for it.

As capital from outside of ribbon.

IRA is no longer really a consideration.

And we're I mean, we're incredibly excited about it I think the the as much as we've seen a shift how we operate and run our businesses.

Does that change to battery sourcing strategy.

For <unk> can you rely perhaps on.

Through the the wide ranging applications for LMS.

Some of the cheaper LSP batteries from overseas.

The potential for AI to really shift how we think about operating in the physical world as is.

Thanks for the question Dan is as you mentioned and.

The administration announced the lengthening of the 375% and SRP offset for section 232 automotive tariffs.

Some ways unimagined really large and so that influences how we think about designing logistics inside of a plant. It influences. How we think about designing even plant layouts and so the accretion is companies ultimately the culmination of us coming to the view.

2030 last week.

It also included the ability to designate parts.

In the <unk> automotive classification.

That we wanted to have direct control and direct influence over the design and development of advanced AI robotics that would be very focused on industrial.

Expand the pool of eligible parts, which is particularly important for a company like <unk>, which is heavily vertically integrated so.

Industrial applications and so these are you know.

Today, we source a lot of raw material inputs that we're building.

Our robotic solutions, we will be creating through this entity through mind robotics.

Building a sub assemblies of.

Claire McDonough: On a go-forward basis, we expect the impact to be a few hundred dollars per unit for new builds once these policies are fully in place. We'll see a trend down in terms of the tariff exposure in Q4, since we'll certainly be selling some vehicles that may have higher levels of tariffs sitting in inventory or parts that we're building towards in inventory today. That's the general glide path and trajectory there. Maybe I'll pass the second part of your question on the R2 battery cell sourcing back over to RJ.

Internally that arent necessarily werent previously necessarily designated under section 232 classification, and we're really appreciative of the administration for at these new changes that were announced at most recently.

That.

That are designed and optimized around manufacturing and industrial environments.

Thank you.

Our next question comes from Dan Levy with Barclays.

Your line is open please feel free to Amit and ask two questions.

As you think about the impact on the quarter itself based off of what we the product that we sold.

Hi, good evening, Thank you for taking the questions.

I wanted to ask if you could possibly give us the latest update on.

So we're just under that couple of thousand dollars per vehicle of impact in Q3 and on a go forward basis, we expect the impact to be a few hundred dollars per unit four and new builds once these policies are fully in place and we will see a trend down in terms of the tear.

Tariffs within the results I know you had stockpiled batteries. So I don't know if there is.

Any impact there, but we have seen some changes in tariff policy and then maybe just broadly on terra.

R.J. Scaringe: Yeah. The R2 program, we've talked about this in the past, is launching with a 4695 cylindrical cell. That cell, starting in the late 2026 timeframe, will be produced in the United States, in Arizona. We, of course, sourced that quite some time ago and have been developing in close partnership with the supplier of that cell, which is LG, for some time. As you point out, there are opportunities to look at other sources of battery cells, both in terms of chemistry and in terms of supplier. As it relates to the production that's coming out of our Normal facility, that's planned to be the LG cell produced in Arizona.

Tara given.

If exposure in Q4, since we'll certainly be selling some vehicles that they may have higher levels of tariffs sitting in inventory or parts of it that way.

<unk> no longer really a consideration how does that change to battery sourcing strategy.

For our two can you rely perhaps on.

We're building towards in inventory today.

Some of the cheaper LSP batteries from overseas.

The general glide path and trajectory there and then maybe I'll pass it the second part of your question on the <unk> battery cell sourcing back over to to RJ.

Thanks for the question Dan is as you mentioned and the administration announced the lengthening of the 375% MSRP offset for section 232 automotive tariffs.

Yes, so the the <unk> program, we've talked about this in the past is launching with a 46 95 surgical cell and that sell <unk>.

2030 last week. It also included the ability to designate parts in the <unk> automotive classification that expands the pool of eligible parts, which is particularly important for a company like <unk>, which is heavily vertically integrated so today, we source a lot of raw material inputs that we're.

<unk>.

In the late 2026 timeframe be produced in the United States in Arizona.

So we of course source vet, a quite some time ago and had been developing and close partnership.

Dan Levy: Great. Thank you. Second question is somewhat related. I know that the regulatory picture still has to sort of emerge a bit more, but it is a bit more clear now. Can you tell us to what extent, now that you have maybe a better sense on tariffs, you have a better sense on red credits, those have moved against maybe some of the initial assumptions you had when you were planning the R2 BOM? Knowing that that BOM is sticky, what mitigants do you have to ensure that you're going to get the appropriate unit economics? I know you've talked about plans to get the BOM cut in half versus R1 and exiting 2026 with a positive gross margin. How do you mitigate against some of these given the BOM is sticky?

We're building a sub assemblies of internally at that.

With the supplier of that cell, which is LG for.

For some time as you point out there are.

Aren't necessarily weren't previously necessarily designated under section 232 classification.

The opportunities to look at other sources of battery cells. Both in terms of chemistry, but also in terms of supplier, but as it is it as it relates to the production that's coming out of our normal facility.

We're really appreciative of the administration for at these new changes that were announced at most recently.

<unk> plans to be the LG cell produced in Arizona.

As you think about the impact on the quarter itself based off of what we the product that we sold we were just under that couple of thousand dollars per vehicle of impact in <unk>.

Okay, great. Thank you.

Second question is somewhat related and I know the regulatory picture is still sort of emerge a bit more but it is a bit more clear now and so can you tell us to what extent now that you have maybe a better sense on tariffs you have a better sense on rent credits.

<unk> three <unk>.

And on a go forward basis, and we expect the impact to be a few hundred dollars per unit four and new builds once these policies are fully in place and we will see a trend down in terms of the tariff exposure in Q4 since we will certainly be selling some vehicles that they may have higher levels of <unk>.

Moved against maybe some of the initial assumptions you had when you were planning the or to bomb and knowing that that pharmacy.

R.J. Scaringe: Well, yeah, there's a lot in that question, but to unpack it, I think first and foremost, the building materials is contractual. As we negotiated the building materials and also made decisions strategically as to where the content that ultimately makes up the building materials in the vehicle was coming from, we made decisions around prioritizing domestic or USMCA-compliant BOM sourcing. Having the parts come out of USMCA-compliant locations was because those decisions were made where we already had line of sight to the likely shift in some of the policies that we've seen recently. I think importantly, those contractual agreements that we have on the BOM itself help really give us confidence in us achieving the BOM and us ultimately getting to the exit rate positive unit economics on R2, positive unit economics at the exit of 2026.

Tariffs sitting in inventory or parts that we're building towards.

Sticky.

Michigan do you have to ensure that you're going to get the appropriate unit economics, I know you've talked about.

Trade today.

The general glide path and trajectory there and then maybe I'll pass it the second part of your question on the <unk> battery cell sourcing back over to RJ.

To get the bomb cut in half versus our one exiting 2006 with a positive gross margin, but how.

How do you mitigate against some of these given the bombers.

Yes, so the <unk> program, we've talked about this in the past is launching with a 46 95 surgical cell and that fell.

Nick.

Well, there's yes, there's a lot in that question, but.

Contacted I think first and foremost the bill of materials is a.

Starting.

It's contractual and so as we negotiated the build materials and also made decisions strategically as to where the content that ultimately makes up the bill of materials and the vehicle was coming from we made decisions around prioritizing domestic or U S. MCA compliant.

In the late 2026 timeframe be produced in the United States in Arizona.

And so we we of course source that.

Quite some time ago and had been developing and close partnership.

With the supplier of that cell, which is LG.

For some time as you point out there are.

Sourcing so.

Opportunities to look at other sources of battery cells. Both in terms of chemistry, but also in terms of supplier, but as it is it as it relates to the production that's coming out of our normal facility.

Having the parts come out of Usmc compliant locations and that was because those decisions are made where we already have line of sight to the likely shift in some of the policies that we've seen recently.

R.J. Scaringe: I think another element that's changing is the expansion of the 232 framework and the allowance for that. The 3-point, what is it, 75? Yeah, 3.75 to carry out longer is very helpful for us. We previously have guided to say the effective tariffs have been a couple of thousand dollars, and what we would now guide to say is that it's a few hundred dollars of tariff cost per vehicle. It's a pretty significant shift for us. Now, I think above and beyond that, just in terms of the overall COGS framework, Javier, you and the team have been very focused on making sure we're ready at the plant. Of course, your team's also responsible for the building materials and supplier sourcing, but just comment on the confidence we have in our cost structure.

<unk> plans to be the LG sell produced in Arizona.

I think importantly, those contractual.

The agreements that we have on the bond itself.

Okay, great. Thank you.

Help really gives us confidence in us achieving the bomb and ultimately getting to the exit rate.

Second question is somewhat related and I know the regulatory picture is still has to sort of emerge a bit more but it is a bit more clear now and so.

Unit economics on our two are two positive unit economics out of it.

The exit of 2026.

Can you tell us to what extent now that you have maybe a better sense on tariffs you have a better sense on.

I think another element that's changing is the expansion of the 232 framework.

Reg credits.

And it moved against maybe some of the initial assumptions you had when you were planning the or to bomb and knowing that that pharmacy.

And the allowance for that the.

The 3.3.

Three point.

Sticky what mitigating do you have to ensure that youre going to get the appropriate unit economics, I know you've talked about.

75 to seven five to carry out longer is very helpful for us.

Javier Varela: Yeah. When it comes to the BOM, RJ, you have explained it. I want to insist that we have sourced on a landed basis. By contract, we have 100% of the cars sourced. We understand what is the cost that we are incurring. The tariff situation is much more favorable, as Claire explained. The rest of the content of the COGS, we are working obviously in the conversion cost, logistics, and all the transformation cost in the plant. We are already doing in Normal huge lean transformation, improving our performance in our daily operations. All these learnings, we will translate them to the R2 operations. Ramp, the design of our process is more compact in R2, less space, less costs in terms of maintenance, and overhead consumption. We are really confident, and we can see and confirm with our internal numbers that we.

And we've previously guided to say the effective tariffs have been a couple of thousand dollars and what we would now guide to say is that it's a few hundred dollars of tariff cost per vehicle. So it's a pretty significant shift for us now.

Plans to get the cut in half versus our one in exiting 2006 with a positive gross margin but.

How do you mitigate against some of these given the Bom is sticky.

Now I think above and beyond that just in terms of the overall Cogs framework Javier you you and the team have been very focused on making sure. We're ready to plant of course through team is also responsible for the bill of materials and supplier sourcing but.

Well, there's yes, there's a lot in that question, but contacted I think first and foremost the bill of materials is a <unk>.

Contractual and so as we negotiated the build materials and also made decisions strategically as to where the content that ultimately makes up the bill of materials and the vehicle was coming from we made decisions around prioritizing domestic or U S. MCA compliant.

Just comment on the confidence we have in our cost structure.

When it comes to the to the Moma RJ you have explained it and I want to insist that that.

We have sourced on a landed basis. So my contract that we have 100% of the car sourced we understand what is the cost we are incurring and the tariff situation is that much more favorable comparable less clear and explain the rest of the content on the Cogs.

Sourcing so.

Having the parts come out of Usmc compliant locations and that was because those decisions are made where we already have line of sight to two.

Likely shift in some of the policies that we've seen recently.

I'm working obviously in the congressional Costa in logistics and they'll all be in all the transformation of our cost in the plant. We have a we are doing already in normal a huge lean transformation improving our performance.

I think importantly, those contractual.

The agreements that we have on the bomb itself.

<unk> really give us confidence in us achieving the bomb and ultimately getting to the exit rate positive unit economics on our two are two positive economics at the exit of 2026.

Our daily operations.

All of these.

Javier Varela: Are sticking to our target of reducing by half the cost.

<unk> will translate them to they are too.

I think another element that's changing is the expansion of the 232 framework.

<unk> and <unk>.

Dan Levy: Great. Thank you.

But any sign of our processes more contact in our tool lesser space less cost.

Operator: Thank you. Our next question comes from Edison Yu with Deutsche Bank. Edison, your line is open. Please feel free to unmute and ask your question.

The allowance for that.

So in terms of maintenance and overhead consumption. So we are we are really confident and ER and we can see.

The.

The three point.

Three point.

Claire McDonough: Hi, Vicky. This is Winnie Ong for Edison. I wanted to ask about the OPEX trajectory on a go-forward basis. You mentioned in the shareholder letter that there is some inclusions there for autonomy training. On a go-forward basis, how should we think about that OPEX line for the purpose of training for autonomy?

What is it 75 to seven five to carry out longer is very helpful for us.

And we've previously guided to say the effective tariffs have been a couple of thousand dollars and what we would now guide to say is that it's a few hundred dollars of tariff cost per vehicle. So it is a pretty significant shift for us.

Confirm with me that were internal numbers that that we have.

Our sticking to our target of reducing by half the cost.

<unk>.

Great. Thank you.

I think above and beyond that just in terms of the overall Cogs framework Javier you and the team have been very focused on making sure. We're ready to plant of course through team is also responsible for the bill of materials and supplier sourcing but.

Okay.

Okay.

Thank you.

Our next question comes from Edison.

Claire McDonough: Sure. Our philosophy and approach has always been to drive efficiencies into the business to help self-fund strategic areas of differentiation, such as our autonomous driving training. As we look at our future roadmap of investment, that remains intact from a philosophy and approach. We're always looking for and committed to finding efficiencies and opportunities to reduce spend within the organization, so that we can also scale the business for the increased volume that we expect to come with the introduction of R2 next year as well. As you think about the R&D spend, we'll see elevated levels of R&D spend in the lead-up to the launch of R2. That's primarily driven by a lot of the work that we do to build development prototypes. Today, design validation builds. We talked a little bit in our prepared remarks about.

Deutsche Bank Anderson. Your line is open please feel free to a niche and ask your question.

Hi, Mickey this is William or Edison.

Just comment on the confidence we have in our cost structure.

I wanted to ask about the opex trajectory going forward.

When it comes to that.

Joe you have explained it.

And you mentioned in the shareholder letter that there is.

Want to insist that that.

We have sourced on a landed basis so my contract.

Some inclusions affluent economy training and so on a go forward basis, how should we think about that Opex line.

100% of our car sourced we understand what is the cost we are incurring and the tariff situation is that much more favorable less clear and explain the rest of the content on the Cogs.

Hi, Tommy.

Sure.

Our philosophy and approach has always been to drive efficiencies into that business to help self fund the strategic areas of differentiation sections are autonomous driving training and as we look at our future roadmap.

We are working obviously in the congressional cost and logistics and all the transformational cost in the plant we have a way of doing already.

And that it remains intact from a philosophy and approach and we're always looking for and committed to finding a few.

Normal are hugely in transformation, improving our performance in our daily operations.

All of these learnings will translate them to our two operations.

<unk> fees and opportunities to reduce spend within the organization.

Claire McDonough: Starting to have manufacturing validation builds in our Normal plant at the end of this year. You'll see some of that external spend drop down when we launch the R2 product. You'll see over the course of 2026 more normalizing levels, despite the fact that we're going to be continuing to ramp up our autonomous training over the longer term as well.

We can also scale the business for the increased volume that we expect.

Ramp and early signs of our process is more compact enough to lesser space less cost in terms of maintenance and overhead consumption. So we are we are.

To come with the introduction of our two next year as well.

So as you think about the R&D spend I will see elevated levels of R&D spend in the lead up to the launch of our <unk> and that's primarily driven by a lot of that work that we do to build development prototypes and such today design validation builds we talked a little bit in our prepared remarks.

Really confident and and we can see and confirm with you that were internal numbers that there.

We are sticking to our target of reducing by half the cost.

Great. Thank you.

Claire McDonough: Got it. That's very helpful. My second question is on the R2 launch for next year. I was wondering if you can comment maybe on the production cadence as you see order flow coming through. How should we anticipate that to sort of look like, first half versus second half, etc., for next year? Thank you.

Thank you.

Our next question comes from Edison.

<unk>.

Starting to had manufacturing validation builds in our normal plant at the end of this year and then you'll see some of that external spend hasn't dropped down when we launched that Archie product CLC over the course of at 26 more normalizing levels. Despite the fact that we're gonna be continuing to ramp up our <unk>.

Which bank Anderson. Your line is open please feel free to mute and ask your question.

Hi, Mickey this is when you or Edison.

Wanted to ask about the Opex trajectory.

We're at basis, and you mentioned in the shareholder letter that there is.

Claire McDonough: Sure. For R2, as we mentioned, we plan to start saleable builds and deliveries in the first half of 2026. We would steer folks to there being limited volumes in the first half of the year. In the second half of the year, we'll build up our ramp and see increasing production volumes throughout the second half of the year, and then into 2027, where we'll first be in a position to have fully optimized the 215,000 sort of run rate units of capacity that we have established within the Normal facility.

Some inclusions affluent economy training and so on a go forward basis, how should we think about that Opex line.

Training over the longer term as well.

Got it that's very helpful and.

My second question is on the.

Thank you for autonomy.

Sure.

Our two launch for next year.

Our philosophy and approach has always been to drive efficiencies.

Wondering if you can comment maybe on <unk>.

Production cadence as you see order flow coming through with how should we anticipate that to look like first half versus second half et cetera prediction.

To help us.

Self funding strategic areas of differentiation sections are autonomous driving training and as we look at our future roadmap.

Sure for <unk> as we mentioned we plan to start have salable builds and deliveries in the first half of 'twenty six now, but we would steer <unk> said theyre being limited volumes in the first half of the year and then the second half of the year will will build up our ramp.

<unk>.

It remains intact from a philosophy and approach and we're always looking for and committed to finding.

<unk> fees and opportunities to reduce spend within the organization. So that we can also scale the business for the increased volume that we expect to come with the introduction of our two next year as well.

Claire McDonough: Very helpful. Thank you.

Operator: Thank you. Our next question comes from Federico Merendi from Bank of America. Federico, your line is open. Please feel free to unmute and ask your question.

<unk>, increasing our production volumes throughout the second half of the year and then into 2027 hour, we will first be in a position to have.

So as you think about the R&D spend I will see elevated levels of R&D spend in the lead up to the launch of <unk> and that's primarily driven by a lot of that work that we do to build development prototypes and such today design validation builds.

Javier Varela: Hi. Good evening, everybody. I wanted to touch upon the capacity that you're building up. In Normal facility, you're going to have 215,000 units of production available in Georgia, from what I understand, 400,000 additional. Given what Emmanuel said about the underlying demand and that you're not going to integrate your production with hybrid vehicles or ranged-distance vehicles, how should we think about the saturation of those two plants that you are building up?

You know fully optimized AD that 250.

15000 run rate units of capacity that we have established within the normal facility.

Yeah.

<unk> talked a little bit in our prepared remarks about <unk>.

Very helpful. Thank you.

Thank you.

Starting to hot manufacturing validation builds in our normal plant at the end of this year and then you'll see some of that external spend.

Our next question comes from Federico and R&D.

Bank of America.

Federico Your line if I can please feel free to Amit and ask your question.

Dropped down when we launched that Archie product CLC over the course of up 26 more normalizing levels. Despite the fact that we're going to be.

Hi, good evening everybody.

I wanted to touch upon the capacity that you're building up.

Normal facility for them to have 215000 units.

Continuing to ramp up our autonomous training over the longer term as well.

Production available in Georgia from what understand 400000 additional.

Got it that's very helpful.

R.J. Scaringe: The Normal facility, as you said, will have 215,000 units of capacity, and that'll be split between R1, our commercial van, and R2. R2 of that will have 155,000 units of capacity. The Georgia facility, built across two phases, will ultimately have 400,000 units of capacity. That'll support R2, R3, and variants of each of those products. Again, I said this before, but I think it's a very important point to make that understanding the demand profile from customers for electric vehicles requires us to look deeper than just EV sales in aggregate, but rather to look at the strength of a vehicle offering relative to what else is on offer. Ultimately, the way customers are going to be making decisions is the price of the vehicle, the value it provides, which is performance, capability, features.

Second question is on the <unk>.

Our two launch for next year was wondering if you can comment maybe on the production cadence as you see.

But.

Given what you what.

Emmanuel said about the.

The underlying demand in and that youre not going to.

So coming to with how should we anticipate that to look like.

Integrate geo production with with hybrid vehicles or.

First half versus second half et cetera.

Sure for <unk> as we mentioned we plan to start at scalable builds and deliveries in the first half of 'twenty six, but we would steer folks said theyre being limited volumes in the first half of the year and then the second half of the year, we will build up our ramp.

Brian just 10 vehicles, how should we think about the saturation of the of those two.

Plants that you.

Our bidding up.

The the normal facility.

As you as you said, we'll have 215000 units of capacity and that'll be split between our one our commercial van and or two and our two of that we'll have 155000 units of capacity.

And see increasing our production volumes throughout the second half of the year and then into 2027 hour, we will first be in a position.

The Georgia facility built across two phases.

We have fully optimized add the 215000 run rate.

Ultimately, a 400000 units capacity and that will support our two or three and variance of each of those products.

Capacity that we have established within the normal facility.

And we.

Again, I said this before but I think it's a very important point to make that the understanding.

R.J. Scaringe: We're very, very bullish on what we're building with R2. The way we think about it as a team is we're building the best car you can buy in this category and in this price point. We want that to be abundantly clear and something that is so self-evident when you use the vehicle. We were just talking about how exciting it'll be for people to compare the vehicle to other things in this price category. We're very bullish on R2. We've also seen that the rate of adoption of EVs really does tie heavily to the number of highly compelling offerings. To date, at this mass market price point, so call it in the $45,000 to $50,000 range, there's really been a single dominant brand with really two products. It's, of course, Tesla with the Model 3 and the Model Y.

Very helpful. Thank you.

Thank you.

The demand profile from customers for.

Our next question comes from Federico Miranda from Bank of America.

For electric vehicles.

Your line if I can please feel free to Amit and ask a question.

Requires us to look deeper than just EV sales in aggregate, but rather to look at.

Hi, good evening everybody.

The strength of a vehicle offering relative to what else is on offer.

I wanted to touch upon the capacity that you're building up.

And ultimately the way customers, who will be making decisions is priced.

Normal for physical event to have 202.

Price of the vehicle the value it provides which is performance capability features.

15000 units.

Of production available and in Georgia.

And so we're very very bullish on what we're building with our too.

Understand.

100000 additional.

The way, we think about it as a team as we're building the best car you can buy.

Got it.

Given what you what.

A matter of a sad about the.

In this category and this price point.

And we want that to be like.

The underlying demand in and that you are not going to.

Blake abundantly clear and something that is so self evident when you use the vehicle we were just talking about how exciting it will be for people to.

Integrate geo production with with hybrid vehicles or.

Brian just send vehicles, how should we think about the saturation of the of those two.

R.J. Scaringe: With them taking up roughly half the market, 50% market share, it's not a reflection of a healthy market. It's a reflection of a very underserved market in terms of choice and options. What we're building with R2 is very different than a Model Y. It's similar size, similar price, but very, very different in terms of the way it's executed. It's going to attract, we think, a very wide range of customers, including people that may be considering EV, but also, importantly, folks that are not necessarily considering EV but just looking for a great vehicle for $45,000 to 50,000. With all that said, what we've shown to date in terms of product sets or product portfolio is the R2, the R3, and the R3X.

Compare the vehicle to other things in this price category.

Plants that you.

And so we're very bullish on our two.

Our bidding up.

We've also seen that the rate of adoption of Evs really does tie heavily to the number of highly compelling offerings.

The the normal facility.

As you said, we'll have 215000 units of capacity and that'll be split between our one our commercial van <unk> and our two of that will have a 155000 units of capacity.

And to date at the at this mass market price points or call. It in the 45 to 50000 Orange Theres really been a single dominant brand with really two products. It's of course tussle with the model three and the model y.

The Georgia facility built across two phases.

Ultimately, a 400000 tons of capacity and that will support our two are our three and variance of each of those products.

And with them.

Taking up roughly half the market, 50% market share, it's not a reflection of a healthy market is a reflection of a very underserved market in terms of choice and options.

And we.

Again, I said this before but I think it's a very important point to make that the understanding.

And so what we're building with our two is very different.

The demand profile from customers for four.

Then our model Y at similar size similar price, but very very different in terms of it's the way it's executed and so it's going to attract.

R.J. Scaringe: Importantly, there's other variants, which, of course, we haven't shown yet, but that will be built off the R2 and R3 platforms. That will support the overall volume in Georgia as well.

For electric vehicles.

Requires us to look deeper than just EV sales in aggregate, but rather to look at.

We think a very wide range of customers, that's including people that may be considered an EV, but also importantly folks that are not necessarily considering V. But just looking for a great vehicle.

The strength of a vehicle offering relative to what else is on offer.

And ultimately the way customers would be making decisions is priced.

Javier Varela: Thank you. I would assume that to basically ramp all that volume, you will export vehicles to other regions or countries. When should we assume that you will enter into other markets?

Price of the vehicle the value it provides which is performance capability features.

For.

$45 $50000.

And so we're very very bullish on what we're building with our too.

And so.

With all that said, what we've shown to date in terms of product sets our product portfolios to the archery and there are three ex <unk>.

The way, we think about it as a team as we're building the best car you can buy.

In this category and this price point.

Importantly, there's other variance which of course, we haven't shown yet but that will be built off the or two in our three platforms.

And we want that to be.

R.J. Scaringe: Yeah. The R2 and R3 vehicles are absolutely architected from the very beginning and designed from the very beginning, contemplating Europe and planning for Europe. We think they both fit the European market extremely well. We haven't announced European timing yet. It is really a core part of the program. It was also a key element of the decision that we made to set up the plant in Georgia, given its ease of export for vehicles going to Europe.

Abundantly clear and something that is so self evident when you use the vehicle we were just talking about how exciting it will be for people to.

That will support the overall volume in Georgia as well.

Thank you and.

Compare the vehicle to other things in this price category and so.

I would assume that.

So we're very bullish on our two.

To basically ramp all the debt that volume if you will.

We've also seen that the rate of adoption of Evs really does tie heavily to the number of highly compelling offerings.

Export vehicles to other regions or countries.

When when should we assume that.

And to date at the at this mass market price points. So call. It in the 45 to 50000 Orange Theres really been a single dominant brand with really two products. It's of course tussle with the model three and the model y.

We will enter into other markets.

Yeah. The art INR three vehicles are absolutely architected from the very beginning and designed from the very beginning contemplating Europe and planning for Europe.

Javier Varela: Thank you.

Operator: Thank you. Our next question comes from James Picariello from BNP Paribas. James, your line is open. Please unmute and ask your question.

And we think they've they both fit the European market extremely well and we Havent announced European timing yet.

And with them.

Taking up roughly half the market, 50% market share its not a reflection of a healthy market is a reflection of a very underserved market in terms of choice and options.

But it's it is really a core part of the program and it was also.

Javier Varela: Hi. Can you hear me?

Claire McDonough: Yes, we can hear you.

And so what we're building with our two is very different.

A key element of the decision that we made.

Javier Varela: Great. Thanks. Just on free cash flow, how are you thinking about working capital in the fourth quarter relative to the strong source of cash contributions in the second and third quarters? I know it was previously indicated that we should expect CapEx to run higher next year. Is there any dimensioning you can share regarding that increase next?

Then our model why it's similar size similar price, but very very different in terms of it's the way it's executed.

To set up the plant in Georgia, given its ease of export for vehicles going to Europe.

And so it is going to attract.

We think a very wide range of customers, that's including people that may be considered an EV, but also importantly folks that are not necessarily considering UV, but just looking for a great vehicle.

Thank you.

Thank you. Our next question comes from James Picariello from BNP Paribas.

James Your line is open.

For.

She's on mute and ask your question.

<unk> $45 $50000.

Claire McDonough: Sure. As we look at the fourth quarter, as implied by our guidance, we do expect to see a step up in our capital expenditures for Q4. As you rightfully call that, we've seen strong favorability in working capital trends throughout the first three quarters of this year. We'll see that reverse a little bit in the fourth quarter, where we expect working capital to consume cash in the fourth quarter. As we look at the working capital outlook for 2026, as we build up inventory for R2, we expect working capital overall for 2026 to be a use of cash. We'll see that normalize as we ramp and get to our run rate levels overall. As Javier mentioned, very focused on making sure that we have very lean operations in Normal as we look at the broad-based inventory outlook for the business.

And so.

Hi can you hear me.

With all that said, what we've shown to date in terms of product sets our product portfolios to the our three north reacts.

Yes, we can hear you.

Great.

So just on free cash flow how are you thinking about working capital in the fourth quarter relative to the strong source of cash contributions in the second and third quarters and I know it was previously indicated that we should expect capex to run higher next year is there any dimensioning you can share regarding that increase thanks.

Portland.

Theres other variance, which of course, we haven't shown yet but that will be built off the art too in our three platforms.

That will support the overall volume in Georgia as well.

Thank you and.

I would assume that.

To basically ramp all the debt.

Sure as we look at the fourth quarter Amor as implied by our guidance, we do expect to see a step up in our capital expenditures for Q4.

But volume if you will.

Export vehicles to other regions or countries.

When when should we assume that.

And that is as you rightfully called out we've seen strong favorability in working capital trends.

We will enter into other markets.

Yeah. The art INR three vehicles are absolutely architected from the very beginning and designed from the very beginning contemplating Europe and planning for Europe.

Throughout the first act three quarters and this year I will see that reverse a little bit in the fourth quarter. However, we expect working capital to consume cash in the fourth quarter and then as we look at the working capital outlet for 2026, as we build up inventory for our two Ah we expect working capital.

And we think they both fit the European market extremely well, we haven't announced European timing yet.

Claire McDonough: In the longer term, we'll provide more details on the 2026 CapEx outlook on our Q4 earnings call. We'll circle back with more details there. As RJ mentioned, that would be additional capital to start vertical construction for the Georgia facility that would be reflected in our 2026 CapEx spend.

But it's it is really a core part of the program and it was also.

Overall for 2026 that to be a use of cash.

Key element of the decision that we made.

To set up the plants in Georgia, given its ease of export for vehicles going to Europe.

And we will see that normalize as we ramping and get to a run rate levels overall and are as Javier mentioned very focused on making sure that we have very lean operations in normal honestly look at the broad based inventory outlook for the business.

Thank you.

Thank you. Our next question comes from James Picariello from BNP Paribas.

Javier Varela: Understood. That makes sense. My follow-up with respect to the next tranche of BW investment, the billion dollars in equity, this is tied to two scopes of successful winter testing, I believe. Do you expect the testing to take place this winter or late next year? Just curious on the timing there. Thank you.

James Your line is open.

She's on mute and ask your question.

In the longer term, we will provide more details on the 2026 Capex outlook on our Q4 earnings call.

Hi can you hear me.

Yes, we can hear you.

So we'll circle back with more details there.

Great.

So just on free cash flow how are you thinking about working capital in the fourth quarter relative to the strong source of cash contributions in the second and third quarters and I know it was previously indicated that we should expect capex to run higher next year is there any to mentioning you can share regarding that increase thanks.

As as RJ mentioned that would be additional capital to start our vertical construction.

Claire McDonough: We don't plan to comment on exact timing. As you heard me talk about in my prepared remarks, we're confident in our ability to achieve the billion dollars of equity investment from Volkswagen Group in 2026.

The Georgia facility that would be reflected in our 2026, our capex spend.

Understood.

That makes sense so.

My follow up with respect to the next tranche of VW investment the billion and equity. This is tied to two scopes of successful winter testing I believe do you expect the testing to take place this winter or late next year, just curious on the timing there. Thank you.

Sure as we look at the fourth quarter Amor as implied by our guidance, we do expect to see a step up in our capital expenditures at for Q4 and that is as you rightfully called out we've seen strong favorability in working capital trends.

Javier Varela: Thank you.

Operator: Thank you. Our next question comes from Ben Peller with Baird. Ben, your line is open. Please feel free to unmute and ask your question.

Mark Delaney: Hey, good evening. Thanks for taking my question. There may be two parts with the R2 coming. I know, RJ, you've talked about $45,000. Could you just talk about the philosophy around pricing? Model Y and other Tesla models, they would release the highest trim, if we want to call it that, first, and then kind of scale down from there as the market expands. Can you talk to us about pricing, and how you set that versus cutting it in the future, considering that for now, at least at Normal, it seems like supply could be limited? How does that tie into the Georgia plant and R2, because it seems like you have a lot going on in pricing, kind of differentiating the two in a shorter amount of time? Thank you.

Throughout the first at three quarters of this year I will see that reverse a little bit in the fourth quarter kind of where we expect working capital to consume cash in the fourth quarter and then as we look at the working capital outlet for 2026, as we build up inventory for our Q, we expect working capital.

We don't plan to comment on exact timing, but as you heard me talk about in my prepared remarks, we were confident in our ability to achieve.

The billion dollars of equity investment from Volkswagen Group in 2020.

Okay.

Thank you.

Overall for 2026 to be a use of cash.

Thank you.

Our next question comes from Ben Taylor.

With bet Ben Your line is open please feel free to Amit and ask your question.

And we will see that normalize as we ramping and get to a run rate levels overall and are as Javier mentioned very focused on making sure that we have very lean operations in normal honestly look at the broad based inventory outlook for that business.

Hey, good evening. Thanks for taking my question, so maybe two parts with the <unk> coming.

Joe you've talked about $45000 could you just talk about your philosophy around pricing.

In the longer term.

Model Y on other models released with the highest trim from Michael about first and then <unk>.

I'll provide more details on the 2026 Capex outlook on our Q4 earnings call.

R.J. Scaringe: Yeah. In the early part of next year, we're going to have an R2 event where we'll go through the full portfolio of R2 products, which would include the different pricing levels across trim and powertrain configuration. Of course, as you called out, when we're starting a production line of a new vehicle, we're going to limit the number of variants that we're building. We have a launch edition for the R2. This is a classic challenge because there are thousands and thousands of people that are excited for R2. Some will want the most base version, the lowest price version. Others are going to want the highest-end version. Some will want something in the middle. We spent a lot of time really thinking around what's the right version to launch with.

Rail down from there as the market expands but can you think about could you talk to us about pricing.

So we'll circle back with more details there, but as as RJ mentioned that would be.

How you set that versus cutting in the future.

Additional capital to start our vertical construction for the Georgia facility that would be reflected in our 2026 Capex spent.

Considering.

For now at least it nor will it seems like supply could be limited.

And how that ties into that.

Understood that makes them.

The Georgia plant or two because it seems like you have a lot going on in bid pricing kind of differentiating the two it is.

So.

My follow up with respect to the next tranche of VW investment the $1 billion in equity. This is tied to two scopes of successful winter testing I believe do you.

Short amount of time so thank you.

In the early part of next year, we're going to have a <unk> event, where we'll go through the full year.

The testing to take place this winter or late next year, just curious on the timing there. Thank you.

Portfolio of our two products, which would include the different pricing levels across trim and powertrain configuration.

We don't plan to comment on exact timing, but as you heard me talk about in my prepared remarks, we were confident in our ability to achieve the $1 billion of equity investment from Volkswagen group in 2026.

And so of course is as you called out when we're starting a production line of a new vehicle.

R.J. Scaringe: Well, I'm not going to provide the pricing of what that is here. I'll say that it's a dual-motor variant, and that's well-appointed, but it's not intended to be our most expensive version. It is intended to be a very nicely set up vehicle, which we think will make the most people the most happy, which is really the goal we had in selecting our launch configuration. As implied, following the initial ramp-up with that launch configuration, we'll then add in the other trims and other configurations, which, at that event I referenced earlier, we'll go through that in the early part of 2026 and talk about when those different trims are going to be available.

We're going to limit the number of events that we're building and so we have a launch edition.

For the <unk> and.

Yeah.

Okay.

This is a classic challenge because there's.

Thank you.

Thank you next.

And thousands and thousands of people that are excited for Ferrari to someone want the most based version of the lowest price version others going to want the highest end version someone wants something in the middle.

Next question comes from Ben Pillar.

With that Ben Your line is open please feel free to Amit and ask your question.

Hey, good evening. Thanks for taking my question, so maybe two parts with our two coming.

And so we've spent a lot of time.

Thinking around what's the right version to launch with and so we've.

Joe you've talked about $45000 could you just talk about your philosophy around pricing.

While I'm not going to provide the pricing of what that is here I'll say that it's a dual motor variant and that's.

Model Y on other models, they would release with the highest trim and from what I call about first and then kind of a scaled down from there as the market expands but can you think about can you talk to us about pricing.

That's well appointed but it's not it's not intended to be our most expensive version, but it is intended to be.

A very nicely set up vehicle, which we think will make the most people. The most happy which is really the goal we had and selecting our launch configuration, but as as implied following the initial ramp up without launch configuration will then add.

Mark Delaney: Thank you. My follow-up is along the same lines. Just in terms of marketing versus advertising versus cutting price to figure out the market size, how do you guys think about where advertising fits in? A lot of the questions focus on other OEMs retrenching and not going down the path of EVs or doing hybrid electrics. Is there something that you guys can do through advertising or marketing to kind of distinguish that not all EVs are built alike? Thank you.

How you set that versus.

Cutting in the future.

Considering.

For now at least it nor will it seems like supply could be limited.

In the other trends in other configurations, which at that event I referenced earlier.

And then how that ties into.

The Georgia plant or two because it seems like you have a lot going on in bid pricing kind of differentiating the two it is.

We'll go through that in the early part of 2026 and talk about when those different trends are going to be available.

Short amount of time so thank you.

Thank you.

Yes.

In the early part of next year, we're going to have on our two event, where we will go through the full.

Along the same lines just on in terms of marketing versus advertising.

R.J. Scaringe: Yeah, it's an awesome question. I mean, ultimately, the question is getting at this point of awareness, awareness of what R2 is and awareness of Rivian as a brand. Some of that will naturally come just from the presence of R2 on the roads and having more people have access to it, the brand becoming much more accessible because of a much lower price point, and some of the same word of mouth that's benefited the brand to date with R1. Beyond just the existence of the product, the presence of it on the roads, and the positive dynamics associated with word of mouth, we are putting a lot of thought into exactly how we'll launch different campaigns of the vehicle, that's putting in unique places, making sure that it's.

Versus cutting price to figure out who would go to market size, how do you guys think about.

The portfolio of our two products, which would include the different pricing levels across trim and powertrain configuration.

Causing presume because lot of the questions of focus about on other Oem's retrenching.

And so of course as you called out when we're starting a production line of a new vehicle, we're going to limit the number of events that we're building and so we have a launch edition.

You go down the path of evs or or doing a hybrid electrics and so is there something that you guys can do through advertising or marketing to distinguish.

For the <unk> two and.

This is a classic challenge because there is.

Not all <unk> are alike.

And thousands and thousands of people that are excited for our two someone want the most based version of the lowest priced version of it is going to want the highest end version someone want something in the middle.

Yeah, It's a it's an awesome question and so I mean ultimately the question is getting at this.

Besides this this point of awareness awareness of what our two is an awareness of <unk> as a brand and some of that will naturally come just from the presence of our two on the roads and having more people have access to it the brand becoming much more accessible because of a much lower price point.

So we spent a lot of time.

Thinking around what's the right version to launch with and so we've.

Well I'm not going to provide the pricing for that in here I'll say that it's a dual motor variance and that's.

R.J. Scaringe: Whether those are physical activations that are temporary in nature, physical activations that are through partnerships with other entities, is it going to show up at a ski resort, is it going to show up at a restaurant, these types of decisions to the more digitally focused marketing spend that allows people to see and experience the vehicle. We've historically not really relied heavily on paid marketing. That's certainly been a decision, but it's also, I think, there's an opportunity there for us to be thoughtful and highly measured, but thoughtful in how we deploy dollars into driving awareness so folks know about this really incredible product that we've developed.

That's well appointed but it's not it's not intended to be our most expensive version, but it is intended to be.

And some of the same word of mouth, it's benefited the brand to date with our one.

A very nicely set up vehicle, which we think will make the most people the most happy with.

But beyond just the existence of the product the presence of it on the roads and there's a positive dynamics in social with word of mouth, we are putting a lot of thought into exactly how we will.

Which is really the goal, we had and selecting our launch configuration, but as as implied following the initial ramp up without launch configuration will then add.

Launch different campaigns of the vehicle that's putting in unique places.

In the other trends in other configurations, which instead event I referenced earlier.

Making sure that it's.

Whether those are physical activations that are temporary in nature physical activations that are through partnerships with other entities.

We'll go through that in the early part of 2026 and talk about when those different trends are going to be available.

Thank you.

Which you know is it going to show up at a ski resort is going to show up at a restaurant. These types of decisions to the more digitally focused.

Paul is a long to save lives.

Arms of marketing versus advertising.

Mark Delaney: Thank you.

Versus cutting price to figure out who would go to market size, how do you guys think about.

Operator: Thank you. Our next question comes from Philippe Houchois with Jefferies. Philippe, your line is open. Please feel free to unmute and ask your question.

Marketing spend it allows people to see and experience of the vehicle and we've historically not really relied heavily on.

Causing pizza because lot of the questions of focus about on other Oems retrenching.

Paid marketing and that's certainly.

Javier Varela: Right, thank you very much. Good afternoon.

You go down the path of bvs or doing a hybrid electrics and so is there something that you guys can do through advertising or marketing to distinguish.

It's been a decision, but it's also I think there's an opportunity there for us to be.

Thoughtful and highly measured both thoughtful in how we deploy dollars into driving awareness. So folks know about this really incredible product that we developed.

Not all <unk> are alike.

Operator: Felipe, are you still there?

Okay.

Yeah, It's a it's an awesome question and so I mean ultimately the question is getting at this.

Javier Varela: Can you hear me again?

Thank you.

Operator: Now we can hear you.

Thank you.

R.J. Scaringe: We didn't hear any of the questions.

Besides the.

Our next question comes from Philippe <unk> with Jefferies. Philippe Your line is open so feet, Amit and ask your question.

Point of awareness awareness of what our two is an awareness of <unk> as a brand and some of that will naturally come just from the presence of our two on the roads and having more people have access to our brand becoming much more accessible because of a much lower price point.

Javier Varela: Sorry about that. Right. Okay. Sorry about that. Yeah. My question was on, so it's clear on tariff, and thanks for the clarification that it's a negative still, but less negative than it would have been six months ago. What has become a net positive, though, compared to the past, is the fact that the dollar is weaker and import duties into Europe are going to go from 10% to 0%. I'm just wondering to what extent it has kind of shifted your thinking on Europe. I know you talked about Europe, and R2, R3 are well-suited for the market. I would agree. Does it make sense to think about a faster rollout into Europe and potentially also a bigger scale?

Alright, Thank you very much and good afternoon.

Sure.

And some of the same word of mouth, that's benefited the brand to date with our one.

But beyond just the existence of the product the presence of it on the roads and there's a positive dynamics in social with word of mouth, we are putting a lot of thought into exactly how we will.

Library so there.

Can you hear me again.

Now we didn't really hear any of your questions.

Right, Okay, sorry about that.

Launch different campaigns of the vehicle that's putting in unique places.

My question was on Ontario.

Terry and thanks for the clarification that it's a negative still they're less negative than you would've been six months ago.

Javier Varela: If you think about the potential of the market, is it still appropriate to try to do direct selling from the US exports, or does it make sense to try to use local distribution and dealers in Europe as a separate business model? Thank you.

Making sure that it's.

Whether those are physical activations that are temporary in nature physical activations that are through partnerships with other entities.

It has become a net positive though compared to the past the effect of the dollar is weaker.

And import duties into Europe, I'm going to go from 10 to zero and I'm, just wondering to what extent it has kind of shifted your thinking on Europe. I know you talked about Europe, and our two or three are well suited for the market I would agree.

Which you know is it going to show up at a ski resort is going to show up at a restaurant. These types of decisions to the more digitally focused.

R.J. Scaringe: Yeah. The impact of a 0% export tariff is certainly something we've been quite enthusiastic about, and we're pleased to see. As you pointed out, it hasn't had as much attention as we think it deserves. Well, as I said before, we haven't announced the timing for when we're going to be exporting to Europe. It's certainly part of our own calculus on deciding when we add that layer of complexity to the business, recognizing that we have a lot of demand here in the United States, and we want to make sure we achieve critical mass for this large pool of demand that we have here in the US. At the same time, as you said, without a tariff to now bring our vehicles from the United States to Europe, there's a real opportunity to get into Europe sooner.

Marketing spend it allows people to see and experience the vehicle and we've historically not really relied heavily on.

And does.

Does it make makes sense to think about it.

Foster rollout into Europe.

On paid marketing and that's certainly.

And potentially also the biggest scale and if you think about the potential of the market is it still appropriate to try to do a direct selling from the U S exports or does it make sense to try to use <unk>.

It's been a decision but it is also I think there's an opportunity there for us to be.

Thoughtful and highly measured both thoughtful in how we deploy dollars into driving awareness. So folks know about that's really incredible product that we developed.

Local distribution and dealers in Europe as a separate business model. Thank you.

Yeah, the the impact of of a zero percent export tariff is certainly something we've we've been quite enthusiastic about and we're pleased to see and it has as you pointed out it hasn't had as much attention as we think it deserves.

Thank you.

Thank you.

Our next question comes from Philippe <unk> with.

Jefferies Philippe Your line is open please feel free to Amit and ask your question.

Alright, Thank you very much and good afternoon.

And so while as I said before we haven't announced the timing for when we're going to be exporting to Europe, It's certainly part of our our own.

Sure.

R.J. Scaringe: These are the types of things we're thinking about, but we haven't yet said exactly when we'll be in Europe.

Calculus on deciding when we add that layer of complexity to the business recognizing that we have a lot of demand here in the United States and we want to make sure we achieve critical mass for the for this large pool of demand that we have here in the U S. But at the same time as you said without a tariffs and I'll bring our vehicles from that I'd say.

Javier Varela: Right. If I can do a follow-up, I think you've been quite efficient in delivering the R2 development on time, and that's congratulations for that. Can you remind us what kind of time lag we might expect between R2 hitting the road and then R3? Is it 12, 18 months, 24 months? What's the time frame there?

Library still there.

Can you hear me again now we can hear you and we didn't we didn't hear any of your questions.

Right, Okay, sorry about that.

My question was on Ontario.

Terry and thanks for the clarification that it's a negative to steal their lesson negative then you would've been six months ago.

It's to Europe, there was a real opportunity to get into Europe sooner and so these are the types of things, we're thinking about but but we havent yet.

What has become a net positive though compared to the positive side. The dollar is weaker.

R.J. Scaringe: We haven't announced R3 yet in terms of timing. What we have said is that R3 will be produced only in our Georgia facility. We're not planning to produce that in our Normal facility. The Georgia facility, we have said, is launching in late 2028, so it would be no sooner than the launch of that facility in Georgia.

Import duties into Europe, I'm going to go from 10 to zero and I'm, just wondering to what extent it has kind of shifted your thinking on Europe I know you talked about Europe.

We haven't yet said exactly when we'll be in Europe.

Alright, and if I can do a follow up I think you've been no quite efficient in delivering Dr. True development on time and that's congratulations for that can you remind us what kind of timeline, we might expect between our two hitting the road and then three is it 12 months 18 months 24 months, which can be.

Two or three are well suited for the market I would agree.

And.

Does it make makes sense to think about it faster rollout into Europe.

And potentially also the biggest scale and if you think about the potential of the market is it still appropriate to try to do a direct selling from the U S exports or does it make sense to try to use.

Javier Varela: Great. Thank you very much.

Operator: Thank you. Our next question comes from Andre Shepherd with Cantor Fitzgerald. Andre, please go ahead and ask your question.

Good timeframe now.

We haven't announced our three yet.

In terms of timing.

But what we have said is that our three will be produced only in our Georgia facility, we're not planning to produce that in our animal facility.

Claire McDonough: Wonderful. Good afternoon, everyone. Thank you so much for taking my question and everyone's questions. Really do appreciate it, and congrats on all the progress. RJ, I think most of my questions have been asked. I do want to maybe go back to a subject which I believe you're quite passionate about, which is autonomy. I guess with the rapid acceleration and deployment of self-driving vehicles, both in passenger vehicles and commercial vehicles, I'm curious if maybe you can give us perhaps a little bit more into your vision for Rivian's approach. I realize we probably get a lot of these answers in the AI day coming up, but curious if you see a scenario where Rivian is more likely to pursue perhaps a robotaxi partnership with a vendor or perhaps pursue autonomy in commercial vehicles, maybe even with the EDVs. Any thoughts there? Thank you.

Local distribution and dealers in Europe as a separate business model. Thank you.

Yeah, the the impact of of a zero percent export tariff is certainly something we've we've been quite enthusiastic about and we're pleased to see.

And the Georgia facility, we have said is launching in late.

<unk> 2028.

And so it would be no sooner than the launch at our facility in Georgia.

And it has as you pointed out it hasn't had as much attention as we think it deserves an.

Okay. Thank you very much.

Thank you.

And so while.

Our next question comes from Andre <unk> with Cantor Fitzgerald.

As I said before we haven't announced the timing for when we're going to be exporting to Europe, It's certainly part of our our own.

Please go ahead and ask your question.

Wonderful.

Calculus on deciding when we add that layer of complexity to the business recognizing that we have a lot of demand here in the United States and we want to make sure we achieve critical mass for the for this large pool of demand that we have here in the U S. But at the same time as you said without tariffs now bring our vehicles from.

And everyone. Thank you so much for taking my question and everyone's questions really do appreciate it and congrats on all the progress.

I think most of my questions have been asked I do want to maybe go back to a subject, which I believe you are quite passionate about which is autonomy.

I guess with the rapid acceleration and deployment of self driving vehicles, both in passenger vehicles and commercial vehicles.

Then I'd states to Europe.

As a real opportunity to get into Europe sooner and so these are the types of things, we're thinking about but but we havent yet.

R.J. Scaringe: Yeah. Well, first, thanks for the plug for our autonomy day on 11 December. We're incredibly excited about that. We're going to be going into a lot of detail there, talking about a number of things we've not yet talked about publicly, and unveiling a lot of the technology behind what we're building and what we've been focused on over the last several years to enable this. I guess first, at the highest level, this is an area of the business, and this is a technology drive within our business that we think is going to be among the most important for transportation. It represents one of the largest investment areas for us as a company. It represents one of the most focused R&D efforts for us as a company. As you already said, it captures.

Curious if maybe you can give us perhaps a little bit more into your vision for radians approach and I realized we'd probably get a lot of these answers in the AI day coming up but.

We haven't yet said exactly when we'll be in Europe.

Right and if I can do a follow up I think you've been no quite efficient in delivering Dr. Two development on time and Thats. Congratulations for that can you remind us what kind of timeline, we might expect between our two hitting the road and then three is it 12 months 18 months 24 months, which can be.

Curious if you see a scenario where arabian might pursue is more likely to pursue perhaps a robo taxi partnership with a vendor or perhaps pursue autonomy in commercial vehicles, maybe even with the E. D. These any thoughts there. Thank you yeah, well first thanks for the the plug for our economy.

Good timeframe now.

We haven't announced our three yet.

In terms of timing.

In December 11th we're incredibly excited about that.

But what we have said is that our three will be produced only in our Georgia facility, we're not planning to produce that in our animal facility.

We're gonna be going into a lot of detail there.

And talking about a number of things that we've not yet talked about publicly and unveiling a lot of the vote.

And the Georgia facility, we have said is launching in late.

<unk> 2028.

Technology behind what we're building and what we've been focused on over the last several years to enable this but.

And so it would be no sooner than the launch at our facility in Georgia.

R.J. Scaringe: A tremendous amount of excitement from us as a business and certainly from me. As I said earlier, in terms of the applications for autonomy, it is very wide-ranging. We think it's going to become a very powerful driver of sales. When you think about the products we're launching, particularly with R2 and R3, the form factor of those vehicles is so universally useful. It's universally useful for a personally owned vehicle. It's universally useful for a vehicle that might participate in any form of ride-sharing services. It's universally applicable in the United States and in Europe.

Okay. Thank you very much.

I guess first at the highest level. This is an area of the business and this is a technology.

Thank you.

Our next question comes from Andre <unk> with Cantor Fitzgerald.

Drive within our business that we think is going to be among the most important for transportation and so.

Please go ahead and ask your question.

Wonderful good after.

And everyone. Thank you so much for taking my question and everyone's questions really do appreciate it and congrats on all the progress.

It represents one of the largest investment areas for us as a company. It represents one of the most focused R&D efforts for us as a company and as you already said it's.

I think most of my questions have been asked I do want to maybe go back to our subject, which I believe you are quite passionate about which is autonomy.

It captures a a tremendous amount of excitement from us as a business and certainly for me.

I guess with the rapid acceleration and deployment of self driving vehicles, both in passenger vehicles and commercial vehicles.

No as I said earlier, though in terms of the applications for autonomy.

It is very wide ranging we think it's it's going to become a very powerful.

R.J. Scaringe: Layering on top of that already very interesting vehicle in terms of form factor, package, pricing, very high levels of autonomy, we start to look at well beyond hands-off wheel, eyes on the road, but into hands-off wheel, eyes-off road, point-to-point navigation, so address to address. We look at that as a really significant driver of demand. What will unlock a lot of folks that may not have even been considering Rivian or an EV is to say, wow, I really like this car, but I also really like the fact that it can give me my time back. It can drive places with me sitting in the car on my phone, getting my time back. That is our North Star.

I'm curious if maybe you can give us perhaps a little bit more into your vision for radians approach and I realized we'd probably get a lot of these answers in the AI day coming up but.

A very powerful driver of sales.

And.

When you think about the products, we're launching particularly with our two or three.

Curious if you see a scenario where arabian might pursue is more likely to pursue perhaps a robo taxi partnership with a vendor or perhaps pursue autonomy in commercial vehicles, maybe even with the edd's any thoughts there. Thank you, yes, well first thanks for the the plug for our economy.

The form factor of those vehicles is so universally useful so it's universally useful for a personally owned vehicle, it's universally useful for a vehicle that's going to that might.

Participate in any form of ride sharing services.

Mitch University of applicable in the United States and in Europe.

At the end December 11th we're incredibly excited about that.

And so layering on top of that already very interesting vehicle in terms of form factor package pricing very high levels of autonomy, where we start to look at well beyond hands off realize on road, but into hands-off wheel is off road.

We're gonna be going into a lot of detail there.

And talking about a number of things that we've not yet talked about publicly and unveiling a lot of the.

Technology behind what we're building and what we've been focused on over the last several years to enable this but.

R.J. Scaringe: It's not that we will be able to start immediately there, but what we'll talk about on 11 December will be what that roadmap looks like. First, expansion of the number of roads that we have hands-free on, then overlaying that with point-to-point address to address navigation, and then following that, adding in for select specific environments, hands-off and eyes-off, which is an important one. Over time, growing the number of locations and broadening the operational design domain for where the vehicle can operate with eyes-off. That is the core focus for us as a business, and doing that well will unlock, as you already alluded to, many different types of businesses that will support what we already build in our commercial business, which we're quite excited about. It opens up opportunities for robotaxi, but importantly, by far and away, the largest revenue opportunity is.

Point to point navigation, so address your address.

We look at that as a really significant driver of demand.

I guess first at the highest level. This is an area of the business and this is a technology.

And what will unlock a lot of folks that may not have even been considering libyan or an EV, but to say, while I really like this car, but I also really like the fact that it can do that can give them my time back I can it can drive places with me sitting in the car on my phone.

Drive within our business that we think is going to be among the most important for transportation and so.

It represents one of the largest investment areas for us as a company. It represents one of the most focused R&D efforts for us as a company and as you already said it's.

Getting my time back and so on.

And that is our north star.

It captures our.

Not that we will be able to start immediately there, but what we will talk about in December 11th would be what that roadmap looks like.

A tremendous amount of excitement from us as a business and certainly for me.

As I said earlier, though in terms of the applications for autonomy.

First expansion of the number of roads that we have hands free on.

And then overlaying that with point to point address the address navigation and then following that adding in for select.

It is very wide ranging we think it's going to become a very powerful.

Very powerful driver of sales.

Specific environments hands off and is off which is an important one and then over time growing the number of locations and broadening.

And.

When you think about the products, we're launching particularly with our two or three.

The form factor of those vehicles is so universally useful so it's universally useful for a personally owned vehicle. It's universally useful for vehicle, that's going to that that might.

R.J. Scaringe: Consumer-owned vehicles or vehicles owned by a household represent well in excess of 95% of the miles driven in the United States. That is largely true for Europe as well. That is our core focus to start, but to be very, very clear, the technology can be applied in many, many different places.

The operational design domain for where the vehicle can operate with eyes off and so that's that is like the core focus for us as a business and doing that well will unlock off as you already alluded to many different types of businesses that will support what we already built in our commercial business, which were which were quite excited about.

Participate in any form of ride sharing services.

It's universally applicable in the United States and in Europe.

And so layering on top of that already very interesting vehicle in terms of form factor package pricing very high levels of autonomy, where we start to look at well beyond hands off realize on road, but into hands off wheel is off road.

Claire McDonough: Wonderful. That's super helpful. Really appreciate all that color. Maybe just as a quick follow-up, one for Claire. I don't believe this has been asked about yet, but just on the DOE loan, can you maybe just remind us or refresh us kind of your expectations from 44 withdrawals for next year and beyond? Thanks.

It opens up opportunities for robo taxi.

But importantly by far and away the largest revenue opportunity is consumer owned vehicles are vehicles owned by household that represents.

Point to point navigation, so address to address.

Well in excess of 95% of the miles driven United States and it's that's largely true for Europe as well.

We look at that as a really significant driver of demand.

Operator: Sure. The DOE loan, if you recall, is a project-based finance loan, which means that we would need to be underway with vertical construction of our site in Georgia. We would also need to have met, at that point in time for first advance, a number of different conditions, precedents ahead of initial draw. As RJ alluded to, we plan to begin vertical construction in 2026 and see the first vehicles coming off of the line by the end of 2028.

And so that's that's our core focus to start but to be very very clear that technology can be applied in many many different places.

And what will unlock a lot of folks that may not have even been considering libyan or an EV, but to say, while I really like this car, but I also really like the fact that it can do they can given my time back I can it can drive places.

Wonderful that's super helpful really appreciate all that color.

Maybe just as a quick follow up one for Claire I don't believe this has been asked about yet, but just on the Doe loan can.

With me sitting in the car on my phone.

I'm getting my time back and so.

Can you, maybe just remind us of refreshes kind of your expectations from four four withdrawals for next.

And that is our north star.

Not that we will be able to start immediately there, but what we'll talk about in December 11th will be what that roadmap looks like.

Next year or and beyond thanks.

Sure the Doa alone and if you recall, it's a project based finance, along which means that we would need to be underway with vertical construction of our state and in Georgia and it also match at that point in time for first advance a number of different conditions precedents ahead of initial draw.

First expansion of the number of roads that we have hands free on.

Claire McDonough: Wonderful. Thank you.

Operator: Thank you. Our final question for today will come from Colin Langen with Wells Fargo. Colin, your line is open. Please feel free to ask your question.

And then overlaying that with point to point address the address navigation and then following that adding in for select.

Specific environments hands off and is off which is an important one and then over time growing the number of locations and broadening.

[Company Representative] (Rivian Automotive): Oh, great. Thanks for taking my questions. I just want to ask, if I look at the midpoint of guidance, it implies just that EBITDA is actually improving into Q4. The midpoint of delivery guidance will be down. What would drive better Q4 EBITDA on lower volumes?

As as RJ alluded to we plan to begin vertical construction in 2026 empty that first vehicles coming off the line.

The operational design domain for.

Where the vehicle can operate with eyes off and so that's that is like the core focus for us as a business and doing that well will unlock off as you've already alluded to many different types of businesses that will support what we already built in our commercial business, which were which were quite excited about it it opens up opportunities for <unk>.

At the end of 2028.

Wonderful thank you.

Thank you.

Operator: Sure, Colin. As you think about the trajectory for the fourth quarter overall, we anticipate seeing a consistent level of EDV volume as a whole as you look to Q4 results. The EDV has historically had a lower cost basis associated with it as well, so that's one factor. The other factor is, as we look ahead to the future, we'll continue to earn increasing levels of revenue associated with our background IP for the Volkswagen Group joint venture as we continue to show progress against key milestones in the JV. Similar to what you've seen throughout the course of Q3 relative to Q2, there could be incremental improvement in terms of the gross profit benefit from software and services as well.

Anil question for today will come from Colin Langan with Wells Fargo. Colin Your line is open please feel free to ask a question.

Great. Thanks for taking my questions.

Taxi.

Oh Wow.

But importantly by far and away the largest revenue opportunity.

I look at the mid point of guidance it would imply adjusted.

Is consumer owned vehicles are vehicles owned by household that represents well in excess of 95% of the miles driven the United States and it's largely true for Europe as well and so that's.

It's actually an overall or the.

The midpoint of delivery guidance down.

So what what would drive better.

We will file on lower volume.

That's our core focus to start but to be very very clear that technology can be applied in many many different places.

Okay.

Sure Colin as you think about the trajectory for the fourth quarter and overall.

Wonderful that's super helpful really appreciate all that color.

We anticipate seeing consistent level of ETB volume as as a whole if you look to that to Q4 our results and.

Maybe just as a quick follow up one for Claire I don't believe this has been asked about yet, but just on the Doe loan can.

Can you, maybe just remind us of refreshing as kind of your expectations from four four withdrawals for next year or and beyond thanks.

The ETB has historically had a lower cost basis associated with it.

As well as.

Okay.

One factor and then the other factor is as we look ahead to the future.

Sure the Doa alone and if you recall, it's a project based finance loan, which means that we would need to be underway with vertical construction of our state and in Georgia and it also match at that point in time for first advance a number of different conditions precedence ahead of initial draw.

Is will continue to earn increasing levels of background revenue associated with our background IP for the Volkswagen group and joint venture as we continue to show progress against key milestones in the JV assets similar to what you've seen throughout the course of Q3.

Operator: In my prepared remarks, I had mentioned on the SG&A side, we do expect to see a slight reduction in our SG&A spend in the fourth quarter.

[Company Representative] (Rivian Automotive): Got it. We talked about regulatory credits. You do not expect any for the rest of the year. Are there any, as we think about 2026, is there any coming? I know sometimes the contracts are multi-year, or should we kind of assume 2026 also does not have any regulatory credit at all?

As RJ alluded to we plan to begin vertical construction in 2026 and see that first vehicles coming off the line.

Three relative to Q2, there could be incremental improvement in in terms of the gross profit benefit from software and services as well.

The end of 2028.

Wonderful thank you.

Thank you our final question for today will come from Colin Langan with Wells Fargo. Colin Your line is open please feel free to ask your question.

Operator: Yeah. As I mentioned before, we've taken regulatory credits out of our forecast, just given some of the uncertainty in the broader policy environment.

And then in my prepared remarks, and I had mentioned on the SG&A side, we do expect to hear a slight reduction in inner SG&A spending in the fourth quarter.

Great. Thanks for taking my questions.

If I look at the mid point of guidance. It would imply adjusted will go is.

[Company Representative] (Rivian Automotive): Got it. All right. Thank you, Susan.

Paddle <unk>.

<unk> talked about regulatory credit journey.

It's actually an overall or.

Operator: This concludes the Q&A section of the call. I would now like to turn the call back to RJ for closing remarks.

At the midpoint and so we'll break that down.

Or are there any other.

Think of that.

So what what would drive better.

Hello.

R.J. Scaringe: Thanks, everyone, for joining today's call. Hopefully, you can hear in our voices just the level of excitement that we have for R2, and importantly, the technology platforms that we're building, certainly our autonomy platform being chief among them. We've got a lot of work to do in front of us as we get ready for the launch of R2. As I said, I've been spending a lot of time in our vehicles, and they are just absolutely incredible, both the vehicle, the technology, the autonomous capabilities of the vehicles. We're incredibly excited to spend more time on 11 December talking around our autonomy technology and overall AI within the business and within the vehicles. Certainly, in the early part of next year, starting to get folks in our R2 products, and that is what we're heads down on focus.

Our multiyear Fortunately panel this morning.

We will file on lower volume.

Overall global portfolio.

Okay.

Sure Collyn.

Yeah, as I mentioned before and we've we've taken regulatory credits out of our forecast and just given some of the uncertainty in the broader policy environment.

Think about the trajectory for the fourth quarter and overall.

We anticipate seeing consistent level of EV volume as as a whole if you look to that to Q4 our results and.

Our focus along.

This concludes the Q&A section of the call I would now like to turn the call back to Jay for closing remarks.

The ETB has historically had a lower cost basis associated with it.

As well as it.

Thanks, everyone for joining today's call hopefully you can hear in our voices are just the level of excitement that we have for our two.

One factor and then the other factor is as we look ahead to the future.

Is will continue to earn increasing levels of background.

And importantly, the the technology platforms that we're building.

Background revenue associated with our background IP for the Volkswagen Group and.

Certainly our autonomy platform being chief among them, where we've got a lot of work to do in front of us as we get ready for the launch of our two but as I said I've been spending a lot of time in our vehicles and they are just absolutely incredible both for vehicle the technology the autonomous capabilities of the vehicles and so we're incredibly excited.

<unk> joint venture as we continue to show progress against key milestones in the JV assets similar to what you've seen.

R.J. Scaringe: We spent a lot of time talking about the vehicle itself, but the rest of the business is also being prepared. That's all of our go-to-market functions, our service functions. Of course, as you heard from Javier, getting our plant and our operation teams ready. We are focused on that and feeling very excited for the launch of the vehicle and for the launch of all this technology that we've talked about today. Thank you, everybody, for joining today's call.

Throughout the course of Q3.

Relative to Q2, there could be incremental improvement in in terms of the gross profit benefit from software and services as well.

To spend more time in December 11th talking around.

Our autonomy technology, and overall AI within the business and within the vehicles.

And then in my prepared remarks, I had mentioned on the SG&A side, we do expect to hear a slight reduction in interest G&A spending in the fourth quarter.

And then certainly in the early part of next year starting to get.

The folks in our two products and that is that is what we're heads down on focus we spend a lot of time talking about the vehicle itself, but the rest of the business is also being prepared that's all of our go to market functions. Our service functions of course as you heard from Javier getting our plants and our operations team is ready and so we are.

Operator: This concludes today's call. Thank you for joining us. You may now disconnect.

That will all work.

That regulatory credits you don't expect.

There are there any I would think about.

Hello.

That's a multiyear fortunate in front of us.

Well first of all.

Focused on that and feeling very very excited for the launch of the vehicle and for for the launch of all of this technology that we've talked about today.

Yeah as I had mentioned before and we've we've taken regulatory credits out of our forecast just given some of the uncertainty in the broader policy environment.

Thank you everyone for joining today's call.

This concludes today's call. Thank you for joining US you may now disconnect.

Our focus all along.

This concludes the Q&A section of the call I would now like to turn the call back to Jay for closing remarks.

Thanks, everyone for joining today's call hopefully you can hear in our voices are just the level of excitement that we have for our two.

And importantly, the the technology platforms that we're building.

Certainly our autonomy platform being chief among them.

Got a lot of work to do in front of us as we get ready for the launch of our two but as I said I've been spending a lot of time in our vehicles and they are just absolutely incredible both the vehicle the technology the autonomous capabilities of the vehicles and so we're incredibly excited to spend more time in December 11th talking around our autonomy.

Technology, and overall AI within the business and within the vehicles.

And then certainly in the early part of next year starting to get.

Folks and our two products and that is that is what we're heads down focus we spend a lot of time talking about the vehicle itself, but the rest of the business is also being prepared that's all of our go to market functions. Our service functions of course as you heard from Javier getting our plants and our operations team is ready and so we are.

Focused on that and feeling very very excited for the launch of the vehicle and for for.

The launch of all of this technology that we've talked about today.

Thank you everyone for joining today's call.

This concludes today's call. Thank you for joining US you may now disconnect.