Where Will Rivian Be in 3 Years?

The electric vehicle (EV) industry is having a moment right now

After a few years of rising consumer interest, government investments, and general optimism in the economy, EV makers now face rising costs, cutbacks in government-sponsored EV incentives, and consumers who are on the lookout for cheaper vehicle options

There's a lot of debate as to where EVs are headed, but you don't have to be an EV-hater to acknowledge that the next few years could be bumpy for automakers, including Rivian (RIVN -2

As a Rivan holder, I've been keeping a close eye on the pressures the EV industry is facing right now and how it's impacting Rivian

Here are three things to watch with regard to Rivian over the next three years

Tariffs and high costs could continue to weigh on Rivian President Donald Trump announced a slew of tariffs just a couple of months ago, with some significant ones aimed at automakers and their supply chain

While Rivian is a U. -based company, duces its vehicles in Illinois and sources many of its parts from American companies, it's still being negatively impacted by tariffs

CEO RJ Scaringe said in an interview back in April: One of the things with automotive is the supply chain is so complex, where we have hundreds of suppliers viding parts from, say, a headlight or a tow hook or tires or the structure under the skin here that are coming from not only a set of suppliers that supply to us, but those suppliers have suppliers, and then in turn, those suppliers have suppliers, so there's tier two, tier three

In short, it's nearly impossible to source everything from U

More importantly, it's making Rivian vehicles more expensive by up to a couple of thousand dollars per vehicle, according to Scaringe

That's especially bad at a time when elevated interest rates are already keeping some potential buyers on the sidelines

No one knows how long tariffs will stay in place or what their long-term impact will be, but it's they're already putting negative pressure on Rivian

A pivot from government incentives could pinch the EV market For a few years, the U

Government was helping to boost the EV industry with incentives

Rivian's trucks and SUVs didn't nically qualify for the credit because they're too expensive, but there was a leasing loophole that allowed customers to claim the credit

Now that it's gone, Rivian could lose some potential customers

A federal judge recently ordered that the funds need to be distributed, though the legal fight isn't yet over

The combination of disappearing tax incentives for EV purchases and the current administration holding back funding for charging infrastructure does not bode well for the EV industry

To reach mass adoption (and the lower costs associated with it), EVs need a robust charging network, and some incentives need to be in place

With these drying up, Rivian and other EV makers may have a tougher time convincing buyers to go electric

New models on the way Rivian recently released its second-quarter duction and deries figures, and it wasn't all that great

Over the next three years, Rivian will launch its new R2, R3, and R3X vehicles

Cheaper EVs could help Rivian expand its customer base and convince reluctant EV converts to ditch their gas-powered vehicles

These new models are one of the big reasons why I continue to hold onto Rivian's s

Expanding to lower-priced EVs is a key component to getting consumers to transition away from traditional vehicles

If Rivian gets it right (and it will take time to do so), then it could transition its lineup from a nice-to-have luxury duct to a legitimate option when people go car-buying

Rivian's next three years will ly be difficult With tariff uncertainty, rising duction costs, and a lack of federal investments for EVs, I think the next three years will be a bit bumpy for Rivian

As an investor, I'm keeping an eye on the company's duction and dery goals to see if Rivan can meet its targets

I also think Rivian's new vehicles could play a vital part in the company's success over the next few years, but that'll be determined by how well it attracts new customers and if the selling price is low enough

Rivian appears to be making the right moves to turn itself into a successful EV company, but the next few years will ve whether or not the company can weather outside forces well enough to reach its goals

Chris Neiger has positions in Rivian Automotive

The Motley Fool has no position in any of the stocks mentioned

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