Rivian Automotive (RIVN) 28 Feb 232022 Q4 Earnings call transcript

Good day, and thank you for standing by. Welcome to Rivian's Fourth Quarter and Full Year 2022 Earnings Conference Call. [Operator Instructions]. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Tim Bei, Vice President of Investor Relations. ahead. go Please

thank quarter and joining for us Good earnings you call. fourth XXXX Rivian's afternoon, for

Joining today's Claire Chairman shareholder website. and Financial us our A letter Chief Scaringe, on Officer. our Executive call, is we available Officer; Investor of and copy McDonough, on Chief RJ our today's have Relations Founder,

securities as and begin, we of to your conference include without our call, like reflect manufacturing RX; this and that to expectations responses questions regarding goals; that laws, our our under to and expansion; regarding only deliveries. federal and trends; you are Before and our and remind ramp would of management's products related statements forward-looking views including, including capacity comments will our I industry market course enhancements, production during opportunity; today production strategy and business the vehicle statements our statements operations; business future limitation, product

differ forward-looking today's which or in materially our in business, SEC from are contained to Actual in letter. with uncertainties and filings due results and our statements may associated those these shareholder described by implied risks

measures call, provided letter. both we will financial non-GAAP today's and measures. in reconciliation this of to non-GAAP GAAP A shareholder GAAP During financial discuss is

around begin that, shareholder call. RJ to with of Just months. today's progress details the an over it the will the I read on letter, the items turn opening cover With encourage we before some a published remarks. overview call call, additional who our for recent includes we'll which of our I'll you few over to

through the the XX,XXX EDV, total year a joining for environment RXS and us. the to for of ramp Hello, is RXT, Tim. Thanks, you operating thank production for us. fought We difficult and year. transformational the vehicles with a everyone, XXXX

on Rivian its and to for generation I targets. in teams helping suppliers next Beyond in-vehicle our the in platform. achieve thank determination product partners their our of grit want RX technologies focused team, our ramp, we and

Network, XXXX. a In the visibility XX% over Adventure backlog maintain experience. We addition that XXX service vans over a production This service nearly charging mobile fourth We physical smoother our and into software well quarter customers provides our which demand customers. We the launched XX range to in represents XX,XXX to quarter, units. vehicle we we increased a infrastructure updates of service XXXX. locations major gives increase of third to our a pushed clear expanded

and added sure year. as our in driving Our we've core make the most place the priorities RX of the for customer reductions, the an priorities. In my experience. delivering role platforms, technologies end-to-end cost leaders to are XXXX focus very RX It's and RCV great capable platform important and on developing the and production design ramping right outstanding future responsibility its and my organizational and experienced is right execute leaders our see drive to have to last we over CEO,

to drive is important profitability. Equally production towards ramping our

our lower operating our we negotiations held this growth Rivian as of are efforts, when some to and scale Day support hosted as these plant was on where the close we're of commercial demonstrate chain work of that in what Core through to a prelaunch. end supplier of solutions our is still XXXX, XXX engineering supply ago the bill We reducing with our the the materials, over material and customer well expenses. logistics our costs, costs overall years to were building. and In to partners we of conversion costs new at of at agreed focused revisiting Supplier the members

possible. achieving profitability the understand quickly as partners are supplier benefits Our fully us as engaged and of

unit. saleable units Enduro our technologies. is of we use Enduro One RX drive Earlier this month, introduction platform, in in van drive in started our enablers reduce application, we our cost our front-drive of single-motor future it our material and our the the also unit, producing as Enduro a and These to our to in-house platform, commercial the commercial the is dual are The phosphate by packs packs use lithium and new LFP cases cost for motor setup, this chemistry. iron our battery we ideally use accompanied all-wheel for drive of it low units commercial suited van durability for drive line. their are due application. of really

Enduro variant. important We development vehicle RXS max fall, expect with excited demand launch to high on configuration, suspension the this in leveraging performance. air pack and RXS with around system, when damping incredible deliver max that X.X example technology we hydraulic I'm introduce of this on-road and begin offering. really this our will Another And off-road seconds. we acceleration and X that is XXX-mile will unit, our will the The deliveries full electro drive for our and new motor dual it to deliver pack XX couple

is The electronics, and drive cost technologies long-term our advantages. structural serve to of platform. improve investments software, to foundation performance will as batteries the purpose our create units and These for in RX

our has Our goal short with vehicle time. We're vehicle, with in are of market and RX of in considerably of located lower equipped and period as the aggressively platforms introduction valuable production a development this manufacturing these cost establishing a facility team RX we'll of the our learnings the well the experience manufacturing operations our applying which to multiple ramp and taking structure. experience new to first build product Georgia advantage in mass as

defining RX, we're and at moment program. exciting of for Speaking the an really

members from true believe across organization, platform. coming have our to what we a engineering design develop to category-defining manufacturing, We together is to

that next at how to of line and built engineering core finalizing the is decisions the majority will which X the the sourcing and drive Over ramp can speed product the production RX we'll we be months, profitability.

that and and our validation attract creating from drive years be received set products to customers strong. excitement doing. media spent We we're what our and new of brand to award-winning The customers continues

Power. including Battery accolades, several named Best being Premium among Experience J.D. RXT new Vehicles the In by Ownership received fact, Electric

Rivian Choice praised best ever the and was in And RXT to driving included Car tested. of highest safety XXXX. pickup the also In addition being Car with survey, standards coveted tougher being its XXXX all all that, satisfaction award, SAFETY Driver's also and highest RXT reports, Driver consumer award We've across and has as XXBest In TOP rating rated across it customer for received IIHS's with our along the highest-rated Editors' was the categories new PICK+ was among the passing truck. from that's IIHS, for categories.

our need which side engagement, the built delivery our software of customer experience and into go-to-market year past the customer robust teams, as remain growth the world. for annual demand On we over and generation our the on service, includes rapid multiple and We plants offerings. we've around to as execute XXX,XXX in service Normal we experienced focused our our against of customer production capacity ultimately business, and scale units end-to-end foundation backlog customers our

combined the me for our this that, impact we've brand, call ability the making our to enthusiasm transition in confidence and Claire. to our we're products economy. a strong The on team the help and built, with over vehicles that with to With planet need pass we carbon-free future drive progress massive I'll our and gives along the technologies the

important drive the reinforce towards to we XXXX steps profitability. want I RJ. took Thanks, during to

year, as product to long measures for In and of our is well cost the to challenging last took lower capable drive build to a we ones. build the good term, as adapting focus a structure. company Rivian intentional goal times portfolio Our during

Operating XXXX half of XX% expenses compared of half as second the in the the fell first to year.

technologies. continue while to we were year operating in XXXX For line invest go-to-market expenses the scale and results, with XXXX, and and full next-generation our delivery operations in

our was more able to highly costs capital production addition, of that billion Normal. start concentrated for to billion versus XXXX equipment fact and our expenditures XXXX leading due into were $X.X in reduce team In $X.X our to facility in our the

We're and there to is drive encouraged by greater progress this an opportunity additional recognize efficiency.

business greatest our our financial leverage investments and the continuing to represent to the on and levers maximize believe of We growing impact aspects concentrating drive We resources our consumer platform. company commercial returns. existing these core our are attractive while

were factors team by able fourth achieve The uncertainty I the our volatility review well focusing our XXXX XX meaningful chain within significant results. economic was as as months across to industry. By characterized will our milestones. on supply control, now last quarter

quarter, vehicles million XX,XXX of quarter of delivered of was XXXX. Gross of and We for profit cost vehicles, quarter X,XXX impacted lower the generated negative LCNRV, During $XXX generated which the profit produced realizable fourth or value, gross revenue. we adjustment. the $X fourth fourth billion a net by for

value adjustment inventory As receiving to the of certain losses the purchase past, for sale discussed records we future the ready costs anticipate and inventory necessary on commitments the after considering to amount upon down the breaks vehicle firm the sale. in LCNRV

December XX, continue These XXXX, as XX, December compared $XX are to million of million expected was through As $XXX of as charges LCNRV XXXX. to XXXX.

sold and the total and per production, reaching no and the reduced plant. on that vehicle will Normal purchase commitments goods lowering charge decline. firm We in other we as forecast gross production However, XXXX, expect profit we material at will material charges by cost anticipate with inventory costs, positive by associated XXXX of LCNRV longer we our have losses end of therefore the logistics

higher per for there continues of of more volumes reflective first of vertically production majority carry production are battery the cost Producing which be continue new during we structure. shift low vehicles impact has highly our volumes motor, will our we the of which our we to impacted that of most our at significant goods negatively technologies we LCNRV, production magnified stopped lines be cost This means were factors introduce like for our ramp designed produced. driver and believe for the Enduro In LFP second do The commercial addition vehicle not overhead quarter to XXXX. on long-term pack levels. sold line as and the currently to in integrated

logistics because QX the cost do our production to position, or our conversion vehicle capitalize particular lead XXXX. an Additionally, volatility received difference our quarter a costs in are goods saw between and inventory, sold in amount on we can of the based in we as not and which we of LCNRV fully materials deliveries we inbound into in

the million expenses in IPO. in donation fell of same as expenses to was $XXX our of billion fourth fourth year. a reduction by to $X.X operations the Rivian business. stock-based difference the including of the was due the due billion XXXX, lower noncash of in compensation approximately Approximately associated to XXXX last Forever cash $X.X of higher remaining quarter conjunction with compared with The Operating expenses period to quarter this and

prioritize to in and business. core customer continue the in-vehicle across We investments driving optimization also cost technologies while focus and additional our experience

cash. billion adjusted the ended This We excludes billion Our fourth of which negative restricted in negative $XXX revolving the $XX million was cash $X.X credit billion, under for of of capacity to facility. quarter the XXXX compares with asset-based XXXX. our the EBITDA quarter quarter equivalents $X.X for fourth cash, fourth and XXXX

monitor We cadence a continue regarding we to the of and growth high level believe our the economic have investments. flexibility environment of

important I take in to changes this opportunity to highlight operational Normal. we're want making

In in overall be which a drop taking down addition week to to the commercial during to first capacity the fourth during EDV the also will the production XXXX, which and to van line prepare shutdown for lines we both expect QX result we quarter RX in XXXX expect of change relative and a XXXX. production for of happen XXXX a quarter in to deliveries

to capacity In the of new overall we down vehicles our few of technologies about take into the for XXXX, plant intend a shift implement weeks production and to plant to XX% the RX. first of be half the

incorporation improved that to temporarily to range technologies vehicle our While and path expected profitability. performance deliver they the provide critically are to these reductions and production, are important impacts cost of new

Now turning to outlook. our XXXX

This technologies. and and also produced year. to the our guiding production the new year-over-year of while uncertainties vehicles associated the XX,XXX doubling integration for supply We represents risks are with for of a accounting chain

shift We to for the progress second quarter. line expect the continue to first ramp through RX of the our

constraints line year We we're expect XXXX. commercial the downtime the to full believe weighted and we QX half back-end year be in will taking to second due of production the in supply alleviate

but begin a our reduce negative, and our cost our improve dollar gross as XXXX, we improving charge our selling basis average per vehicle expected produced, decline. margin remain vehicle goods for year LCNRV is sold anticipate we the see to on of prices to During per

XXXX. For XXXX, compared expenses as are total modestly to increase operating to expected

these factors, is EBITDA an billion expected million $XXX be XXXX. $X.X in XXXX, As a of of versus improvement negative to result adjusted

and our focus additional are greater capital to XXXX continue Normal to core expected Capital expenditures our We the our be business. and rationalize of expenditures a technologies go-to-market due out on build investment billion facilities, $X generation in continued to operations. Georgia driven in next our by

$X In step medium margin of in business needs The addition largest capital QX forecast XXXX. from negative wanted gross to our XXXX the positive to term. address in the swing guidance, in change our is the lever the XXXX a I over profit of in to gross billion

There enable improvement. are that key levers this X

most the per-unit plant large-scale impactful of First, our as labor greater the of overhead reduction number expenses units. driver is produces ramp and a

With staffed run the significantly the second our Normal than shift, rate. addition our units higher in number currently plant current of a produce to is of

context, represent For bridge from to per expect these end the of the expenses of what COGS our X/X we XXXX. current unit by

is our area second The costs. material

map both downs. cost engineering of We commercial have a and detailed road

provides and RJ us The to technologies The Rivian's flexibility introduction demonstrated participate implementation suppliers pressures. in Day bucket in our for pricing new system our the mentioned, our of As the inflationary of reservation Supplier to recent accommodate the price. opportunity is products, XXXX win-win growth. early final

today pricing, in to the we X, to a on While introduce change of average over we well our most X March see XXXX as years deliveries as post step selling new next pre-March price X are preorders. as our move higher-priced expect variants meaningful based

of improvements gross SG&A significant profit outlined, much larger expect see as period we expenses leverage over addition leverage our base. this sales we operating I and a our to In R&D the over expenses to

the being this anticipate expenditures low maintain capital in able billion over also area We time our to $X frame.

in step versus our In we continues the profitability we towards and of enabled cash objective price to cash see technologies. at XX%, to deployment a to as XXXX, driving XXXX versus burn Our our generation expect of profit. next we improve have XXXX by by new our the production a burn full From gross capital. change we expect of year meaningfully our XXXX approximately be points improve perspective, and prudent incorporation

cash operations that We remain XXXX. equivalents our through cash and our fund can confident

we across capital a available Rivian maintain sheet approach of position. continue a balance strong to variety We to look capital employ evaluate portfolio-based markets We as to a structure. ranging the plan to

In let closing, to a back free EBITDA cash clear high me line long-term in the With We for our target, flow approximately margin target Q&A. our I margin and confidence target. see open call want turn to to gross our the reiterate that, targets. financial approximately XX% operator teens to XX% path the

Instructions]. [Operator

Research. Our first question comes from Lache Wolfe the line of Rod with

LCNRV an magnitude kick the Do of things you in Just a losses XXXX? just things expect you maybe to couple for off. have estimate of the

Thanks, Rod.

the and as sit out prepared expect unit a as economics positive we LCNRV, in mentioned I my in we as XXXX about offset approach right, P&L time fully remarks, be of As outlined. think we charge in today, with we $XXX that frame or our charge, to million effect that

to those to you what will even guidance impacts as about a of technology drive for as so that to path for several going costs course we have material about material our provide the EDV, over -- the we is material quarters, early of necessarily within cost importantly, And as see you the Enduro million that the pack a in where it we step as but the be I X QX LFP $XXX and that would the think there. change the in start next that won't reduce unit we as is vehicles, and introductions cadence think introduced we drives example, linear start

producing of now a EDV course as we're technology 'XX become that we had those we'll look 'XX. the see a unit throughout of is example, today But and a been headwind for XXXX we've due introduction profitable from what's to to the So continue at perspective. some marginal for that that changes tailwind

Okay.

to actually it's going decline. So

to goods sold, just subtraction So it XXXX? a from that, in your cost be of clarify would

correct. That's

hoping was can to some when RX to into different your primarily And RX unconventional And that, I RJ, be implement maybe non-battery need for out? preliminary to thoughts Okay. that when we will structure on about -- you you're how us any see? some about give the just those? that innovations be the little manufacturing but vehicle visibility comes think design that you think of cost or competitive what's achieving to Are opportunities what that vehicle? Maybe looking about bit talk batteries are a we there compared

Thanks, Rod.

compute architecture where a really the in As a to lot vehicle. a platforms across some and functions architecture RX introducing the we we technologies RX work the it's leveraging network to our we're into lot going be electronics about smaller the of ECUs, platform, the number terms think updated consolidate of have into number of of of -- compute simplifies simplifies harness, which you of

heavily propulsion and drive on changes our take drive a As RX. from improvements, RX And But program. integrating considerable the chassis about units really we vehicle, developing Claire system, EDV view we RX. those Enduro think learned mentioned, into we've and a unit case leverage of the, for of platform cost really, our lot in interior you vertically focus those point in body, as the drives launching the and and

we've simplifies is can design single consolidate the the result, vehicle, not It reduces less through stampings, less product simplifies larger there's attached really consolidation we that of to the way opportunities so another. things consolidation the assembly be joints, looked of the through use only at as the parts where a that parts to piece of of extrusions to of And castings. or parts, one number need the part there's so And the sourcing process. lens but process. see It

in major, structure. it the of And achieving meaningfully it course, to the line, RX the and us focus really is excitement cost what the that major core with is with but or captured lower for that's of a ensure we product. magic essence RX still so it brand of of a the And fully the product build

opening a our with this in and today we're is, we point The supply vast different a we sourcing other than of my out XXXX, A around thing components very chain majority the in when before the or I'd of remarks, of components were our brand. lot supply customers in noted a I just incredible product, the lot position saw we XXXX, well before we for well RX. are were the launched sourced from response them

the aggressive supplier using in and better now not aggressive components RX, contracts RX, we're the those much RX vehicle. the various help drive to cost So supplier negotiating into much, cost we're much but the as all across more we're only selections, today, more making achieving pricing with contracts

we So that's cost see I to said, that's, lower about a RX, in going materially are we for to product. and aggregate, think that structure as how foundational

for sounds reducing It this in you thinking and cost what at structure like, of in lot into visibility RJ, that? a things visibility point, component you're the like parts are And get will to starting just vehicle. be about castings number Do of the have innovations of RX? you, Giga structure the the a into

have are capacity, lastly, XXX,XXX profitability, just to And on as out do the you but thinking in XXXX? bridging any at sort targets do we're profitability, you -- mentioned get time about XXX,XXX think what for units can of frame? You of as of you kind you least volume to color that to profit look gross you

across component on to thinking your first we're the vehicle. Well, system just design how about design point or

parts. lot at or level to we a the opportunities product all a for reduce of reduce time across on looking at the different holistic tech level spend complexity is the layers a and system of of One the things

for the X into case those systems casting. subassemblies it And together. X in, those motor I'll gearbox, are in drive the and typically X mechanically Enduro, in different that's fastened we took -- of X unit, the are that captured those example, are take, Enduro X, in call our whether inverter, So we the

X, system the parts, unit. X into of drive designed number the this decrease we the reduce holistically assembly build for time So to combine take different of time, fasteners, and or build the increase and course, really it assembly

it's we're of course, for a system, as a a mentality, described, is seat well. a whether frame, But I it's that just this door big everything, body to mindset whether drive that as unit, structure applying opportunity

the that every and one big because into carry much we it's of we that design part enablers something vertically is that It's with, approach the this so vehicle design of review. the have integrated technology. the of we criteria So we

number in to to in it model largely outsourced architecture, the function-based ability computers before, I so in than the the or computer rather you've front, but result electronics. the speak, vehicle, dramatically back, domain-based the middle, zonal an mentioned it's we historically of the of of computers, ECUs how the done vehicles in the which seen and around computer separate is number today, computer a a have through reduce a

as So capability these built areas focus of are built of technology and into in RX. core we've where of we're what terms in some the terms leveraging what go we've we

And maybe... Rod,

volume? the And

have directly [Indiscernible] there question well. on as volume the you that

As today XX% about of my and we as RX that so units re-rate units capacity the or in talked XX,XXX we're the at have I in year. will RX Normal, increasing become plant capacity XX,XXX we capacity lines remarks, prepared midyear next that call it,

of having we'll RX plant to so And next the the incremental both impact multi-week that have add shutdown we as re-rate a capacity. year,

same as number be RJ introducing the at of well. talked And time, generation technologies that we'll next about that just a

ramp half XXXX, perspective. then produce until more that it a where And the in the back so to ramping midyear capacity re-rated won't we'll RX from up we'll in be year we'll be really still shutdown of to units whereby be period full year, but out in of an continuing be the

you to clarify XX,XXX you're that saying have RX not to for what Or just of you? are available saying, will going capacity the you're XXXX? So units

It the midyear in be XXXX. available. will re-rating We're lines

couple a weeks of year full the out the ramps won't perspective, a back back year in shutdown and the have re-rate of as from full that of of then the impact process we go so that we through year. shutdown And of half

can still that, despite gross you're to in profit XXXX? But thinking you get that Okay.

right. That's

Okay.

you of in something could the left I gives XXXX XXXX. from to that's profit billion, -- maybe billion half and to that, to loss Just -- have there's you clarify That you're LCNRV like it $XX,XXX a Maybe $X.X increase. gross see going have price XXXX. looks a benefit like $X

year, If million better. that been $XXX that applied have would was this

profit So Is maybe $XXX that year? fair about that lowered plus loss. would of you're volume whatever we guess to rest think gross as an the I have component gotten it costs. million is next the you bridge to expecting

bridge, it's think to the a volumes we're we that right, business driving in fixed within as increased combination XXXX of that up are ramp cost in significant leverage production plant Normal. continuing about As the levels

then us then X And design is reduction the technologies engineering in and through a next core talk vehicle drivers RJ the material through overall. our we both efforts the for the the next commercial of bit combination have underway costs, cost-down really introduction changes which heard the delivered you is about, generation these that in of

of So about as split between newer XXXX as the ASP drive the pricing I the X, we both move you same cost the then think variants preorders, about also material we fold at downs increases we well into and drivers the XX-XX introduced in in engineering guide as time, XXXX. to change some further changes reduction. a to that improves or past core and step higher-priced the have And commercial would also then pre-March we cost the

comes America. line Bank the Murphy of with question Our John from next of

of still like fair first a around with what's suppliers. amount question Just a sounds there. there's on It bottlenecks going

Supplier I curious those kind RJ, of specifically holding applaud are, for sort you I Just of how mean you having could much that And Day. elucidate you, if where back. they're

it a to them like it's but them that you both along. those but to thing you do closer their like and to for relationships, of sounds you build pull maybe felt needed also get on sort to part, for good comfort sounds It like

moment, what holding kind that of in to understand Supplier Day. how at to there that and hug trying those you just back they're constraints in on the need I'm So XXXX of kind do you bear much why are get and

John. Thanks, Yes.

As lot of with surprises at of look component a didn't of expect terms we that availability. interruptions and supply some the XXXX, we there's and things the in just challenges

to we gap. focus or better exactly to we have very and are wrong us That as or of at much last much year. on visibility allows constraints. XXXX, access a Now were where be go than and challenges what And where going to will picture look different we a there clearer will what visibility supply be

but numbers our And in is that with driving also at I way referenced as that really the the bringing in about us reflects it working case, we've as a have I hard addressed said of Enduro power for new to drive the this this And suppliers, to in through guidance, around up being ramp. in today unit, talked power the supply to semiconductors Claire continue earlier terms multiple sourced constraint, semiconductors. allows

motor So a as we unit dual in in have a the power have driving motor and our from the for we different existing set the suppliers semiconductor motor of single quad what for commercial van.

alleviate along we've but for it built, constraint, that limiting relationships with us year. this allow some of So of the will the to us technology, ultimate new the those be supplier factor changes

And fortunately, around it. unlike last year, we plan can

We into have constraints building what like. this look those

be a is we surprise, going which why not to be it's guide here. thoughtful So to on wanting how we're

sort -- onetime of basis. side a happening on because I this getting what is and because not of RJ, going is micro quickly, what to because not a is lot mean, done certainly of it's the to want what's there's that internally understand of not that what's supply sort people happening chain ease of

that XX,XXX a hey, too right? this as I there to had is units if all that tease get, could be cute? is listen, we mean year, XXX,XXX to units opposed there we way out can to tease So Or actually getting a that way is the semis we say, and out? that

the we of far and coming what's the that by -- constraining away, it's talk the is the about component biggest but We issue talked and think it's on ultimately why supply. I online about constraint really Well, shifts second line our is have is, -- shift. that's RX that our constraint. today. it supply didn't second We ramp, ramp the And

vehicle there. shift think about a the line, we're you still single If running commercial

all across sources of we the have wish have we across think to plant fully I power to as So we in still the types addition case. but having about different that's lines, technologies. multiple it's supply, the not semiconductors, also components -- could multiple shifts, And run of

use and we silicon we across both we those how apply level sets. IGBTs, and carbide vehicle silicon So of the have fungibility some in

positioned I understand to some that hard of major up -- we course, next from worked year going of this so supply be really about constraints you module to our it's a we're of so RX, is think exist this the grow. the of into But XXXX, are and as we've consideration challenging that in and chain very carbide come as we well view. power silicon to out year, over really point And set think a

ultimately just the as bit And step-up RX the in Or then and with little on of than at the well? some that run $X a point? thing lastly, come that plant kind billion that a kind the Okay. at be launching as see and we there Claire, RX can we is could you RX would significant there is maybe of lower have CapEx expected. as real quick. Georgia 'XX, ramps and 'XX, you're

John. Sure,

the continued our reflects Normal of low as the the that years facility investments our aggregate. our in operations $X continued in that across as the billion our continued about, and we'll is have business guidance talked Georgia, the next build-out our in in I As across go-to-market expectation well we of the in CapEx area couple then over maintain plant and investment

I RX past. way us would $X per it is the certainly as in about year up we've a billion in position characterize the sets talked in launch that to Georgia XXXX, in the So

of line next Our question from Dutton ISI. the Doug with Evercore comes

heard a normalized price rerates at XX%? online? sort that and XX% about in profile, still factory, for what and the 'XX normalization with margins of gross full margin target capacity given approach So there, assuming a your can the Normal platform in positive we've reach prior goal 'XX on road to RX at is the phaseouts coming RX mind, and LCNRV follow-up the the this to gross to to And target

Sure.

aggregate target gross we've is margin the then a And to target gross of Our and XX%. overall services, of margin vehicle additional XX%. guided introduction software long-term long-term through

at generation Normal, Our EDV our as the expectation the our and sweet volumes RX integration with through and really well. is vehicle as next first technologies XXXX full and we and price margins, that can come year becomes production we arrive the together target in spot points ramp continued our have of certainly of

of as I that and Normal to can generation that expenses in the 'XX. cash have to Georgia flow a platform platform confidence a to build-out ready company launch our So in lot the invest Normal we support continue in as of Rivian, RX can start operating around believe provide the and get that

bottom me. the That's description And accounting the statement? Could just then helpful. flow explainer of have an we for bucket CapEx at the Okay. question or cash on liabilities and a brief

We can with there. details some follow up you with

of Dan question from Our line Levy the comes with next Barclays.

-- specifically, you ask about the comment maybe you can preorders, a Maybe tailwind. any and I XXXX. can pricing that additional How you trended Wanted to see into provide the preorders mentioned And commentary on have year-to-date? voiceover. as the lasts that,

how You eventually. price flowing given that for calculus? have of competitors, from potential eventually your cut price pricing through your saw does the we large cuts EV one factor But into higher the

Dan. Thanks,

in in, larger compared levels are think we that. segments and products product going these about which need we set and about feel to -- a it you of products. are strong product pickup. that line, really and those The launched line. the through the pricing and this built where to we've vehicles, the It's compete As it the to our establish SUV to as brand pricing part and X-row be flagship The it's segments, X-row is position really things very the RX levels of

very and around online $XX,XXX, with X-row SUV bring RXS is $XX,XXX, performance. at start standard our we'll the just pack, we very, RXT, strong The

So We the from positioning there. confident. there, and adjusted we further feel adjustments in haven't we pricing made XXXX,

allow orders, are ASP, of to the for actually grow vehicle. to the Certainly, new to as in but as us technologies flexibility to not pricing features reservation the of over make new on said, time, post-March us now gives of with we new of the to the and new X Claire process but to reflect the Claire see more technologies noted, some some prices our adjustments introduction do be going coming also some only that

end, of moderation raws material down. a drive And follow-up, the I seen initiatives to the of cost about ask But we've on direction your to to I wanted know costs. cost as Great. the some some just about some I And want raws. mentioned ask you because the on

maybe can material resets. I talk a there's contract just down? you Or of So costs know are about of whether some raw dynamic the coming

be higher might those year-over-year. so And

BOM some underlying talk the could maybe of material costs. the in movement just raw So about the given you

statements embedded as hit backwards those haven't are are we actually inflation of those prices seen index Today, our looking to financial Sure. that because actually pertains many it contracts. contracts our within

so we course begin to itself. And of see as progress benefits the of we'll throughout XXXX those some

within our conservative significant we've would say been bit costs guidance, in a embedded reductions I those of forecasting material not really that also overall.

go-forward the seeing we're So basis. on status projecting much quo more of more of today what a

Our the with next George of Genuity. line Gianarikas question from comes Canaccord

question, you're on been have been preorder I'd net light to the particularly or how but weakening demand I'm as any a EVs, as demand, shed given disclosing you color for curious for so of your there preorders just many like to piggyback the have that tracking? not to know environment previous could question. high-profile preorders, whether I admissions

It in terms we an think, say as into I Certainly what have clear sight think and we us until we're backlog and would is, it, macro is, we're that a of very about robust. what witnessing overall we well interest industry, in gives is moderating But demand what the XXXX. of demand. of seeing across the the having rate line effect

backlog attention vehicles. ensuring the on can of focuses this really the customers satisfying large it get that that, and with organization And we

customer fact team So core around timing. is in today. this every One line? I there our vehicle to our of my biggest can Is tells sooner? week, ahead challenge me How the is get this in get delivery complaints, a way the

price with key. into going the and is the achieve point Now believe, and really a be on this XXXX cost earlier, materially beyond, middle focus on look we is the structure, on And with the the to important. engineering comments really of we to as made cost we out said, lower program, decade, it's note this focus RX important that vehicles really to

those areas think, costs. be of foundational the we've in will on invested terms of And vertical some for we integration, delivering

far vertical Just mines, incredibly might as some seem of things I your be are segue as sure how field. same curious integration. little think buying something partnering much mean have that with a you well? that as into they're mines, follow-up, read doing that about my you question I that explore be getting deep a buying press much the too that. vertical integration I'm vertical to mean Do great and stakes you've I'm into mines releases longer I opinion, to that bit peers that your in in is integration? might term,

I Xx year, kilogram, question had what pointing sort question material with X, hovering towards market to Yes. Well, impact lithium. your hydroxide And costs, has $XX relative it certainly raw talked the George, is a up X.X this EV was and outsized years price most spot think the core of the previous the of about lithium industry, ago. a across around

lithium relationships we're right than X And lithium X in I X our consideration real years thinking manufacturers, years the to lithium the years case, sourcing in about think discussions. carbonate, in a material a ourselves of certainly think those and, structures included, are the existed ago, as deal everyone, about it's midst and OEMs, that causing hydroxide, the ago, what sources of is ago. lot very this different for certainly So what's

That the part, but for the I could in more opportunities positions, structuring. lie involve most unique think just ownership

this anything something an of so we space. amount the haven't large time and but enormous closely announced very some of on it's work And spend that I on front, very with players in

line question Colin with Langan Wells the Fargo. of comes from Our next

-- cash. burned this You're $X billion in year, over through burning through you

billion. $XX have You

those So you mean like cash a years? I the massively. look potential be so not may supposed cash but a rate. more I flow pretty you modestly couple is your the EBITDA sounds decisions? should on need a making guidance, do Or at of massive raise improve better have to capital? we inflection at in a it adjusted higher, When bit, year, What of start thoughts the this see if years couple this CapEx free to is are

profit On as to expect to lever about in XXXX as -- look solutions mentioned from gross We gross approach to or for structure. talked portfolio-based key raising burn then variety maintain we to a across the strong sheet to capital a my that relative from the in perspective capital the to well, profit profit market we'll of is balance position. moderation as And a we a of gross our XXXX execute of negative walk well, remarks cash improvement our plan at continue in see capital I as prepared there a XXXX entirety as from positive significant And as movement significant well. bit is improvements. pretty

it. Got

higher LFP in capital horizon. rate thoughts that health there? the at the actually not think to That's you're call, in plant. on the near-term I a Any mentioned last raising given an planning you that accelerate might apply

Yes, Colin.

view if new going to of point thinking downstream to battery and dedicated at that And be IRA, arrangements supply, of achieve structures lots there's there's supply of need in types slightly lithium capacity. from of I a As the that. look different the ways move in to you and referenced context about to investment capacity,

and That's that something, on. certainly, spending something we're that's part time plan of our

haven't of cell very that of also what of doing supply, aspect We either, new compliant, in raw production. in material terms but creating of anything announced supply it that's front a is creating terms on both we're but IRA important terms in

you own? have do your partner your for have LFP a you Or you Or it? chemistry? own And had

quickly build-out battery think trade-offs about we a when we team think chemistry, for that's of it's internal So that of the cycles And duty to some understand overall our and how key our also closely make portfolio, scale we cell internal can about achieve variety -- need the working to. across for we sure and team an of have the with different battery, applications. we've that different what's very to really developing we that partners right very works

our worked we've That's today, something our partner case very with a that achieve what's vehicles So to to vehicles high and our the performance closely it's refine in today. chemistry. the to develop that nickel supplier in of in

haven't With in on first LFP the launching very that's yet in announced, be the shortly here close commercial be of vehicles road although that that the going the to those partnership we're vans, will soon. the vans we in form

And look chemistries, cell different we lithium of iron across different to partners portfolio need be both high factors we going and nickel there's then to as different achieve form approaches scale cell phosphate. forward, the and and

Brinkman of line question JPMorgan. comes from the next Ryan with Our

I the Inflation it being could wanted from as it to get to bill written, Rivian see your was thoughts on been various have speculated benefits was different I Reduction subsidized Act. remember proposals. manufacturers impact which that it those vehicles, that the any are have in to partnered, only you batteries the the yet right, and making integrated lower-priced end, do. But or are that vertically you

the play better see do years next to benefit or plan to in other So that you to any or company hope from how charging And tailwinds? the do out? expect benefit you act position several as or

Yes.

out towards the the And shift within in RX that, U.S. incredibly supply a the So bill, chain before, and broad to I aggressive to our there's I've in think a of applicable IRA the modules product largely That's think platform. of some tailwind, build line, said with this the a we scale from per benefits build it case some But our drive terms RX the really that's we in electrification it's appropriate and I that the derived platform. benefit. provides $XX aren't a hour manufacturing-facing kilowatt in credit, IRA form the on benefit -- RX because of have U.S., on consumer-facing vehicles

the the vehicle plus a and be manufacture the questions, fall the is that $X,XXX considerably for needs into done important case manufacturing IRA lower we build cells that it's sweet it's price of story. the case we points in such as and to the as way contemplated consumer-facing. cells, vehicle the spot The really to really be the the in the the materials credit of that In we right the ensure Now need and ensures IRA, alluded batteries that previous by of the and different vehicle critical compliance. in RX, very the the sourcing of qualify to of RX,

program the into platform about plays and thinking sourcing decisions. engineering we're how decisions to RX foundational that's So and and certainly

intake Okay. there the right? input the Great. demand, but you -- of anything the on about like seems prices currently and metals, just And there's a all models, follow-up Tesla costs else? that others, some of the Q&A passing some on a But sure the Ford earlier along up level feeling I'm are in that to pricing, charging? around It price how cetera. is of whatnot just order battery large reduction, XX% cut new the for So you're et or the also lower

I is think SUVs take, RXS level to range a you really deal. delivering, RX, example, the the value what And and describing that in as -- if really pricing X-row were of of today. proposition that we levels we I it's was good the as performance the in of it case delivering our RXS feel it's compare, for to other before, confident the of think we're offer at

X XX Of course, range. here, X seconds, over well XXX in we but of to miles get biased

set, to range, at the miles coupled that XXX we're configuration announced motor Enduro of the with As a relative it's X.X to deliver have the well. types that delivers be positioned pack of to to when seconds. with just today, which And talking we dual range we max X XX able in quite pricing about competitive

reductions the a in order I very XX% segment prices seen inflation XXXX, Now think lot been go that seen of price more half the has that significant of of RX the rapidly. the vehicles will. basket, are and on as that if there's market first And saw price we up in you in you said, we've

And saw rapidly. which down that, prices the is side we, very of the course, of come other

-- XXXX the XXXX. a segment part sort in midsized what of seeing crossover we're vehicles and mid what of model of sustainable SUV seeing that we into long-term middle for the think I in pricing parts today were more reflective of is versus stable early and late are

Delaney last Mark from question with the of comes line Our Goldman Sachs.

the and was of RX thought might capacity that had around something and is re-rating the and discussion of much to towards XXXX. later timing capacity that like adjusted One RX. the I the be facility perhaps X/X for me, please, how in shifted about being place be specifically taking might

update terms you you in what could of have the about may and changed maybe in 'XX timing So us spoke XX% today. that the on

Mark. Sure,

As XXX,XXX we that we Normal, talked consumer capacity. just desiring increase that as to to side the looked optimize to the of at towards in in today really tweak installed past, the re-rating the process units And re-rate about within more required investment of maintain capacity of would we've the the around but business tried today. slightly plant, be level the that

level we how required way we so would around trade-offs And make more the would we on production the a line of this increase really that the the as downtime that thought deeply be capacity in disrupt material of or itself. the calibrated about was have line to to the that RX process re-rate

that of well. sort we went to re-rate So those we opportunities this are some re-rate, through we'll over additional obviously opportunity of the go time evaluated through we considerations us. as after the through for core potentially think that increase as And

or demand on terms to commercial taking and in customer from all Claire. be have they comments seen for interest the for may be the any of helpful, may van, change made vehicles? terms IRA, far. in the levels And you already in But That's including able interested delivery so of when customers, you thanks

in Thanks, commented should on I context Mark. have the of actually that IRA.

for clear, of the different. the are vehicles, much -- be Just requirements production cell commercial domestic to

applications, the the applicable. in applicable. also RXT And case of for vans, And case they're in it's our commercial of so commercial

very the important transition commercial are we leveraging. then do helps certainly, seeing as is that, So enabler, our vans, we're we commercial something And of think going And it that and electrification. that that customers talk vehicle RXTs as this very we important. see are buying a owners that case the we some Amazon, ignite see and to of of the this that's in of towards is we to something be large-scale outside see this fleet business

the back conference would remarks. closing Scaringe for RJ to now Thank like turn to over I you.

questions. joining Well, All thanks thank you, the call, right. and for everyone, the for

different starting between my about I in an said a see important we're As XXXX for was It EDV what we we and the the us. year RXS X platform. year launched critical in ramped front RXT, the us. excited vehicles comments, where really of and was

more of RXT as lot start roads, customers And and doubling see importantly, of look We'll into a the but vehicles into the or getting the RXS. we of year, to a output, than hands. vehicles, lot vans on lot a commercial whether the these a customers' consumer this more or lot overall that's of the the

And as more described, and cost for continues vehicles we and I more Claire us road, across start focus of the our driving core both and to the as ramp down see as the on business. that is

focus happening on the that's relationship changes go will heavy the of we commercial up that all we're happen engineering the in volumes when of Claire Some as our naturally that detail, and get with described leverage really cost fixed some but making this also suppliers. through

So lot our with very a profitability. excited you, Thank on we're forward road getting the that, ahead and everyone. about vehicles to towards looking more and year the path

This concludes for today's participating. you conference Thank call.

disconnect. now may You