Rivian Automotive Inc at Goldman Sachs Communacopia & Technology Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Well, I thought maybe to kick things off, I'd ask you a little bit more on the company more broadly and Rivian was ranked number one by consumer reports in terms of owners wanting to buy from the company again. And I know something you guys think a lot about, so I'd love to get your thoughts around why you think that is.

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : That's great. And a lot of us, I think, can certainly see some of those things when we had the opportunity to be owners or do test drive. That's wonderful. Maybe moving to demand. Can you talk a little bit more around what the company has seen in terms of demand and what gives you confidence in low single-digit volume growth for this year?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : When I take some of the comments you just made a challenging macroeconomic backdrop for the entire industry, some of the supply chain issues, I mean, does that change the view that you can grow low single digit or the shape of how the year might look?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Okay. On the last earnings call, you commented that R1 potential output with the current two-shift operation is 56,000 units per year. Is this the run rate we should expect in 2025? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2024 / 3:50PM, RIVN.OQ - Rivian Automotive Inc at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : How quickly could Rivian flex up to the 85,000 potential capacity for R1 if there was sufficient demand? And what might it take to have that kind of a demand environment?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Okay. Speaking to the commercial platform, what type of use cases beyond last mile package delivery could be supported by that?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : I did see on my way to the airport this weekend, a R1T being used as a business vehicle. So multiple ways for incorporations to the Rivian users. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2024 / 3:50PM, RIVN.OQ - Rivian Automotive Inc at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : And maybe help us understand how long might it be before commercial shipments could be material beyond Amazon?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Rivian has a number of opportunities beyond just selling the cars themselves, software services, regulatory credits. So maybe you can talk a little bit more on some of those other initiatives at the company. And help us better understand how material the software services business is for Rivian today? And what are some of the biggest drivers of that?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : In terms of driver assistance, what type of capability do you think is needed for Rivian to have materially higher monetization? And does the company need to get to eyes off capability in order to enable that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2024 / 3:50PM, RIVN.OQ - Rivian Automotive Inc at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : That makes sense. Regulatory credits are also a key source of profit improvement. Can you give more color on how the market for regulatory credits

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Maybe talk about the future product road map, R2 was an important launch, it's the company's 2-row SUV, plan to start production is the first half of 2026. Can you tell us more on how development of the R2 is going?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Maybe you can talk a little bit more around the demand response to R2. You had a very large number of preorders placed within the first 24 hours. Anything else you can share on how R2 has tracked in terms of demand? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2024 / 3:50PM, RIVN.OQ - Rivian Automotive Inc at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Do you think R2 attention is helping or hurting current R1 sales?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : In June, the company announced a proposed joint venture with VW for your electrical and electronic architecture. Can you give additional color on how that is developing towards a definitive agreement and what is left to be worked out.

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : In the past, Rivian had an investment from Ford and an MOU to partner with Mercedes for electric vans. We've also seen lots of proposed partnerships in the auto industry over the years. So as you think about some of these other situations either that Rivian specifically has been involved with or the industry more holistically, maybe can help us better understand how that influence the way you're trying to structure the VW joint venture.

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : That's helpful. In addition to the $5 billion in funding from VW for the proposed joint venture, Rivian is also expecting incremental benefits through cost savings, operating expense efficiencies and potential revenue synergies. Can you give us any more color, in particular, with some of the expense efficiencies that you may be able to see?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Maybe talking on Europe, Rivian has been selling the commercial vehicle in Europe. Have you been surprised at all by anything you've experienced as you've been selling vehicles internationally?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : And it sounds like R2 then is the vehicle we should expect first to be sold in Europe for consumers? And any sense of when to think about that timing? I imagine you'd start delivering in North America first, but how long before we can envision Europe?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Okay. And some financial questions, if I could. The company is expecting a modest positive gross profit in the fourth quarter of this year. How are you tracking towards this goal? And as you think about factors like lower material costs, volume and nonvehicle revenue, how do they get you to that target?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Very good performance.

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : The company also expects a modest positive gross margin in 2025. Maybe talk about how you see profit drivers next year and how that may differ from what you're thinking about for this year and for the fourth quarter?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : That's helpful. At the Investor Day, you spoke about trying to reach positive adjusted EBITDA in 2027. Can you help us better visualize what would need to happen for that to occur in terms of things like how many vehicles a year you might have to sell as one of the key KPIs we should be thinking on?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Okay. Software services aftermarket. Those are some of the higher margin opportunities you have. How do you think about those contributing to the company's 25% gross margin target and getting to that positive EBITDA level?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Okay. Assuming the $5 billion VW funding comes through as planned from 2024 through 2026, how are you thinking about any additional capital needs that Rivian may have?

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Speaking of the future, you also have the Georgia facility that you've announced. Maybe help us better understand when Georgia may go into production? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2024 / 3:50PM, RIVN.OQ - Rivian Automotive Inc at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Got it. We have a couple of minutes left. I do want to see if anybody in the audience has a question. Otherwise, I can go ahead and ask the last one or two. Yes, we've got one in the front. If you don't mind just waiting for a microphone. Unidentified Participant Thank you. It appears that range anxiety is an issue for a lot of consumers and a lot of new competitive vehicles are still coming out with a range that begins with a 2 not a 3. Just wondering what your views are? And how much further can you extend the range over the next few years.

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Yes. Sneak one last question in from the back. Unidentified Participant Electric vehicles have still a fairly low market penetration of about 1%, which means, in my mind, there's a lot of white space to go after. Tesla has a very interesting position in the market, and you have threats from China. What do you see as the potential development of that competitive landscape. Who ends up taking those -- that 99% of the market? And what are the driving factors on who's going to win? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2024 / 3:50PM, RIVN.OQ - Rivian Automotive Inc at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs & Company, Inc. - Analyst : Great. Well, unfortunately, we're going to have to end it there. Claire, thank you so much for joining us.