Rivian's R1T Continues to Impress

For a start-up EV maker like Rivian, it’s huge that its debut model keeps winning plaudits from critics and consumers alike.

In the electric vehicle (EV) industry, which is currently facing a slowdown in U.S. sales growth, it’s more important than ever to understand how consumers are feeling about specific vehicles. In fact, more than 4 out of 10 U.S. owners of EVs who responded to a recent McKinsey & Co. survey said they are planning to buy traditional combustion-engine vehicles for their next automotive purchases.

That’s why investors should pay attention to the Edmunds auto guide’s recent tests of EVs and its insight into which ones its testers would or wouldn’t purchase. That report includes good news for Rivian Automotive (RIVN 4.20%) investors.

Winners and losers

Edmunds has a goal in mind with its long-term EV test fleet, which is to use them every day and discern how they fare during real-world use. Currently, they’re long-term testing nine EVs — which includes cars, trucks, and SUVs across a range of prices.

First up is some good news for Rivian investors, as the R1T continues to impress. Per Edmunds.com: “We’ve experienced owning several cars from start-up manufacturers, and our favorite among them is the 2022 Rivian R1T Launch Edition.”

Rivian’s R1T is one Edmunds’ testers largely said they would buy again, which is hugely important considering the previously mentioned McKinsey & Co. survey result that roughly 40% of current EV owners plan to buy gasoline-powered vehicles next.

On the flip side for Rivian investors, one of its primary competitors also received great marks. Ford Motor Company‘ F-150 Lightning was well-rated by the testers and “is our back-to-back Edmunds Top Rated Electric Truck for a reason.”

The EV version of its bread-and-butter pickup wasn’t the only Ford vehicle getting high marks — its Mustang Mach-E earned Edmunds’ seal of approval too. The Edmunds team noted that after 20,000 miles, the car hasn’t touched a dealership for service or a recall, and remains completely trouble-free.

A perhaps surprising loser was the Lucid Air, which retails for roughly $140,000. For that price tag, consumers are right to expect a nearly flawless experience, but according to Edmunds, that wasn’t what their 2022 Lucid Air Grand Touring edition gave them. The vehicle had too many rattles and quality issues for them to recommend it. However, Edmunds noted in fairness that the company may have fixed those quality issues in subsequent model years.

Another surprising loser was General Motors‘ Chevy Blazer EV, which the staff could not recommend for purchase. Their 2024 model was plagued with reliability issues; it had troubles from the very beginning and was in the shop for more than half of the first four months the Edmunds team owned it. That was apparently not an anomaly — GM actually halted sales of the Blazer EV for a time to deal with the model’s issues. (They are back on sale now, at a discounted price.)

Better news for Rivian

It’s great news that Edmunds found the 2022 R1T performed so well under real-world conditions, but the start-up EV maker has also refreshed the vehicle to bridge the gap until it can start producing the R2 in 2026. The second-generation R1 vehicles have been re-engineered through hundreds of hardware improvements, a new software experience, updated in-house drive systems, and a number of performance upgrades.

In addition to improving the EVs’ power, performance, and range, Rivian introduced two new premium Ascend trims, a new storm blue exterior paint option, and blackout trim options. Those additions are more important than you might think; because these premium trims come with higher margins, they could help lift Rivian to gross profitability even as its deliveries are expected to remain flat.

What it all means

The Edmunds report is just one publication’s opinion, but it’s still pretty good news for Rivian investors, who will be relying on positive consumer views of the brand to keep driving its sales.

Rivian’s R1 vehicles already have numerous awards under their belt. Now, with the R1 refresh completed, the company’s focus will be on getting the more affordable R2 vehicles into production soon, as those models will be key to the company’s future.

Daniel Miller has positions in Ford Motor Company and General Motors. The Motley Fool recommends General Motors and recommends the following options: long January 2025 $25 calls on General Motors. The Motley Fool has a disclosure policy.

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