Rivian Q4 Deliveries Plunge 31% as Wall Street’s Bull-Bear Civil War Exposes R2 Survival Stakes

I’ve been tracking Rivian’s post-tax credit reality for months, and the Q4 numbers confirm exactly what we predicted: without $7,500 in federal subsidies propping up demand, Rivian can’t move R1s off the lot. But here’s what makes this story different from the typical “deliveries miss” coverage: Wall Street is now in open warfare over whether Rivian survives to see the R2 succeed.

The gap between Morgan Stanley’s $12 price target and Wedbush’s $25 target isn’t a minor disagreement. It’s a 108% spread that reveals a fundamental conflict about whether Rivian can navigate a market that just lost its biggest demand driver.

Rivian delivered 9,745 vehicles in Q4 2025, down 31% year-over-year und 26% sequentially from Q3’s 13,201 deliveries. Full-year 2025 deliveries hit 42,247 units, an 18% decline from 2024. The company says these figures were “in line with expectations,” which is technically true since Rivian lowered guidance in October to 41,500-43,400 vehicles.

• Q4 2025 deliveries: 9,745 vehicles (down 31% YoY, missed Street estimate of 10,050)
• Q4 2025 production: 10,974 vehicles
• Full-year 2025 deliveries: 42,247 vehicles (down 18% YoY)
• Cash position (Q3 2025): $7.09 billion
• Quarterly cash burn: Approximately $1 billion
• Stock price (Jan 2): Closed at $19.41 (down 1.5%)

Die Barron’s report frames this as a “2026 is what really matters” story. But dig into the analyst divide, and a very different picture emerges.

The Analyst Civil War: Bulls vs. Bears

We covered Morgan Stanley’s “EV winter” downgrade last month, and the Q4 numbers have only sharpened the battle lines. On one side, you have bulls like Wedbush’s Dan Ives who see the R2 as a “significant opportunity.” On the other, Morgan Stanley’s Andrew Percoco warns that an extended EV winter will crush unprofitable startups before they can scale.

“We believe that 2026 represents a ‘prove-me’ year with its R2 fleet providing a significant opportunity to drive demand with this product expected to provide a low-cost SUV, which has been lacking in the EV landscape,” Ives wrote in a recent report.

Percoco sees it differently: “While we recognize that Rivian plans to compete in this area, we believe the capital requirements and time needed to be competitive may be longer than appreciated.”

This isn’t academic disagreement. The 108% gap between the highest and lowest price targets represents fundamentally different views on whether Rivian can execute the R2 launch before running out of runway.

The Cash Runway Math Nobody Wants to Discuss

Here’s the uncomfortable arithmetic that mainstream coverage glosses over: Rivian ended Q3 2025 with approximately $7.09 billion in cash and equivalents. The company continues burning roughly $1 billion per quarter. Q3 2025 alone showed a $602 million adjusted EBITDA loss.

Simple math: that’s approximately seven quarters of runway at current burn rates.

The R2 isn’t expected to generate meaningful revenue until the second half of 2026 at the earliest. Any production delays, supply chain issues, or slower-than-expected demand could force Rivian to raise more capital in a hostile market, likely leading to significant shareholder dilution.

Compare this to Lucid, which despite its own struggles has the backing of Saudi Arabia’s Public Investment Fund. Rivian’s safety net is the Volkswagen partnership, worth up to $5.8 billion over time. But that money flows based on milestones, not as a blank check.

The Tax Credit Hangover We Predicted

Rivian’s Q3 “surge” of 13,201 deliveries wasn’t organic growth. It was customers racing to claim the $7,500 federal EV tax credit before it expired on September 30, 2025. We covered this dynamic extensively in our October EV sales collapse report, which showed industry-wide sales plummeting 43% year-over-year that month.

Rivian’s Q4 collapse follows the exact pattern. The 31% year-over-year drop isn’t a temporary blip. It’s what happens when you remove $7,500 from the effective purchase price of vehicles averaging $88,500.

Morgan Stanley’s Percoco projects U.S. EV market share could drop to 6.5% in 2026, down from a peak of 11.6% in September 2025. That’s the environment in which Rivian needs to launch a mass-market vehicle and hit Wall Street’s projected 56% sales increase to approximately 66,000 units.

The company has now cut jobs three times since June 2025, eliminating roughly 600 positions in October alone. That’s not the behavior of a company confident in near-term demand recovery.

What Prospective R2 Buyers Need to Know

Die R2 midsize SUV is scheduled for first deliveries in the first half of 2026, with a promised starting price of $45,000. CEO RJ Scaringe has repeatedly committed to holding that price point despite tariff pressures. The company plans to launch with a “Launch Edition” dual-motor variant before offering the base single-motor version.

If you’re holding an R2 reservation, here’s your reality check:

Tax credit uncertainty: Because the R2 will be built at Rivian’s Normal, Illinois plant using domestically sourced batteries (from LG’s Arizona factory starting 2027), it could theoretically qualify for whatever EV incentives exist. But with the federal $7,500 credit already eliminated, don’t count on subsidies to lower your effective purchase price.

Delivery timeline risk: Rivian says H1 2026, but the company is in a race against its cash runway. The Normal plant expansion is complete, but scaling up a new platform while maintaining R1 production creates execution risk. Morgan Stanley explicitly warns that “the capital requirements and time needed to be competitive may be longer than appreciated.”

Launch Edition pricing: The $45,000 figure is for the base single-motor version. The Launch Edition dual-motor that ships first will cost more. CEO Scaringe described it as “well-appointed, but not intended to be our most expensive version.” If R2 pricing follows R1 patterns, well-equipped models could approach $70,000.

What Current R1 Owners Should Consider

Here’s the question nobody is asking: What does a $45,000 R2 do to the resale value of your $70,000-$100,000 R1?

The R2 will offer over 300 miles of range, available all-wheel drive with dual or tri-motor configurations, bidirectional charging capability, and Rivian’s signature adventure-focused design language. Yes, it’s smaller than the R1S. But for many buyers, “smaller” means “fits in my garage” and “$40,000 cheaper.”

Used EV values have already been under pressure industry-wide in 2025. When Rivian starts delivering new R2s at half the price of a used R1S, expect that pressure to intensify. If you’re considering selling your R1, the window before R2 deliveries begin may offer better resale values than waiting.

EVXL’s Take

The 31% Q4 delivery collapse isn’t the story. It was expected. The real story is that Rivian has become Wall Street’s biggest battleground stock, and the outcome determines whether 70,000+ R2 reservation holders ever get their vehicles.

The bull case requires a flawless 2026: R2 launches on time, scales immediately, holds the $45K price point, and captures a market that Morgan Stanley predicts will shrink by 20%. That’s a heroic assumption.

Here’s what I expect: The R2 will launch on schedule, but initial volumes will be constrained. The $45,000 base model will be difficult to actually purchase for months after launch as Rivian prioritizes higher-margin Launch Edition builds. Total 2026 deliveries will hit 50,000-55,000 units, not the 66,000 Wall Street projects. That’s still growth, but not the turnaround story bulls are selling.

The bigger concern is whether Rivian’s seven quarters of cash runway is enough. Unlike Lucid, which has Saudi Arabia’s Public Investment Fund as a backstop, Rivian’s lifeline is the VW partnership and whatever it can generate from spinoffs like Mind Robotics and Also. The company is trying to launch a mass-market vehicle while still losing money on every R1 it builds.

Rivian’s first positive gross margin in Q3 was a significant milestone. But positive gross margin with negative EBITDA of $602 million isn’t profitability. It’s slower bleeding.

For EV enthusiasts, the R2 remains one of the most exciting vehicles on the horizon. Rivian builds genuinely great products. The question isn’t whether the R2 will be good. It’s whether the company’s financial runway matches its ambitions. The “prove-me year” isn’t just about proving the R2 can sell. It’s about proving Rivian can survive long enough to sell it.

Rivian reports Q4 financial results on February 12, 2026. That’s when we’ll see the real damage to the balance sheet.

Are you holding an R2 reservation? Waiting for the base $45K model or planning to jump on the Launch Edition? Does the analyst divide change your confidence? Share your strategy in the comments.