Rivian to Offer Electric Truck and SUV Subscription
Electric truck manufacturer Rivian really wants to sell its EVs a different way through a subscription service. We posted a story about the startup’s “events” where those who reserved a B1T truck or B1S SUV could attend. So far one has happened in Atlanta and another in Seattle.
But Rivian is looking at more ways to market its state-of-the-art vehicles than having meet-and-greets. Now it’s looking at a subscription service. How does that work?
Monthly Subscription Fee
For a monthly fee, Rivian would give subscribers the opportunity to drive a variety of its vehicles. “You may use one solution to get to and from the office during the week, but on the weekend you may want a subscription program,” Rivian CEO RJ Scaringe told Crain’s.
This subscription service model has been tried before with very mixed results. Volvo, Mercedes, and Cadillac all have some sort of subscription service. Cadillac shelved its “Book by Cadillac” program last November but recently its revival. This time around Cadillac dealers will be more integral to the program. The new program will be called “Book 2.0.”
Electric Truck Sales
Rivian’s plan to sell its products is through direct sales without a franchised dealer network. That’s according to Rivian CEO RJ Scaringe. He says, “Core for us is maintaining direct ownership of our customers which means from a sales and retail point of view it’s a direct-sales model.” He went on to say there will be partners working on the back end.
Tesla has a similar model but has encountered trouble from different state franchise laws forbidding manufacturers operating as retailers. With dealer associations pushing back it has landed Tesla in heated legal battles.
Plans are to produce the SUV priced from $69,000 to $72,000, produced at its former Mitsubishi factory in Normal, Illinois. Rivian has broken out of the typical EV startup by attracting some really big companies and some really big capital investments. Retailer Amazon has invested $700 million, Ford Motor Company $500,000, and Cox Automotive $350 million.
Then last month Rivian announced a deal with Amazon to produce 100,000 delivery trucks. Ford has said its interest lies in kickstarting Ford’s EV truck products and is especially interested in Rivian’s “skateboard” platform providing an electric base for a myriad of different models. Cox provides products and services for franchised retailers, so its participation is less known.
About Cox’s investment, Scaringe says, “Cox is an impressive company in its ability to deliver on robust customer processes, whether that’s service or thinking about the future of charging. There are a lot of aspects to the relationship that we are excited about.”
Ownership Not Only Way To Travel
As for the subscription service Scaringe has said in the past Rivian sees car ownership changing in the near future. The company says it thinks that both traditional ownership and new ways of traveling where ownership might be shared or paid for through the cost of use will live side-by-side.
In the meantime, Rivian is moving quickly to begin constructing vehicles next year. Both the manufacturing of vehicles and battery modules will take place under the same roof.