Rivian’s chief executive RJ Scaringe spent nearly half of the company’s third-quarter earnings call promoting its autonomous driving ambitions, as the company set out plans for hands-free driving and robotaxis through 2028 while its mass-market R2 SUV is still scaling up.
Rivian plans to roll out its point-to-point hands-free driving feature to its own employees for testing later this year, to customers in 2027, and to launch its first robotaxi vehicles in partnership with Uber in 2028. Scaringe said he uses the new system on his own commute to the office every day, calling it a wonderful experience, and said autonomy would become a big driver of demand. He also said the market was at the front end of an inflection point and that autonomy could be a big driver of market share for Rivian over the long term. Finance vice president Derek Mulvey said during the call: “We believe autonomy is a primary product differentiator, market share driver, and long-term value creator.”
The bet pits Rivian against Tesla, whose Full Self-Driving (Supervised) system runs in more than 1.7 million active customer cars, and against Waymo. Rivian is designing its own silicon chips, buying lidar sensors and paying for large-scale AI computing power, a costly campaign while the R2, which recently became Rivian's best-selling vehicle by volume, is still ramping up. The company warned that adding two processors and expensive lidar to some R2 models could eat into the profits it hopes to make from large-scale production, and said chips, memory and electronics are getting pricier.
Rivian reported $605 million in revenue from software and subscription services in the third quarter, up 45 percent year over year. It reported $256 million in profit from software and services, up $102 million from a year earlier, at a 42 percent margin. The company is likely to spend more than it earns while it keeps buying costly computers and AI systems.
Scaringe declined to say what proportion of buyers sign up for the Autonomy Plus package, saying the take rate “has exceeded our expectations” and that Rivian is “quite encouraged by it.” Tesla, by contrast, reported that more than 75 percent of new North American buyers opted for FSD in the third quarter.
The hands-free feature will face edge cases and the complexities of urban driving, and a crash could damage Rivian’s brand, as Tesla has experienced with FSD many times. Although Rivian intends the feature to require active driver supervision, legal challenges are likely when things go wrong.
The combination of expensive AI development and R2 production at scale makes the next year or two the company's riskiest period yet, the report argues, but Rivian could not afford to sit on the sidelines and concede the self-driving market to Tesla and Waymo.
Analysis
Why This Matters
- Rivian is wagering its future on becoming a full-stack autonomy player before it has scaled the mass-market R2, making the next two years decisive.
- The hands-free rollout and the 2028 Uber robotaxi plans put Rivian in direct competition with Tesla's Full Self-Driving and Waymo.
- Software and subscription revenue is already growing fast, offering the high-margin earnings the company needs to fund its shift.
Background
Rivian is an American electric vehicle maker known for its SUVs and pickup trucks that is now pivoting toward autonomous driving in a costly bid to compete with Tesla and Waymo, while it works to scale production of its mass-market R2 model. The company is designing its own chips and buying expensive lidar sensors to support the self-driving push.
Key Perspectives
RJ Scaringe (chief executive): has been using the point-to-point system on his daily commute and calls it a wonderful experience, arguing it will become a big driver of demand and a strong long-term driver of market share.
Derek Mulvey (vice president for finance): says autonomy is a primary product differentiator, market share driver and long-term value creator.
What to Watch
- Whether Rivian meets its plan to begin employee testing of the hands-free feature later this year.
- The take rate of the Autonomy Plus package, which Scaringe declined to quantify.
- Whether the added processors and lidar on some R2 models erode the profits expected from volume production.
Checked
12 claims in this story checked against 1 source: 12 supported.
Show each claim
- SupportedRivian’s autonomy push faces a test while the R2 is still scaling up.The Verge: “But taking on Tesla’s FSD with custom chips and pricey lidar is an enormous gamble while the mass-market R2 is still scaling up.”
- SupportedScaringe spent nearly half of Rivian’s third-quarter earnings call promoting autonomy, while spending less time discussing the R2 production ramp.The Verge: “During an hourlong earnings call last night, Rivian CEO RJ Scaringe spent less time talking about the production ramp of the all-important R2 SUV than he did hyping the company’s still-unproven autonomous vehicle ambitions. Rivian’s autonomy gamble faces its first real test RJ Scaringe spent nearly half of Rivian’s earnings call hyping self-driving tech.”
- SupportedRivian plans employee testing of point-to-point hands-free driving in 2026, customer rollout in 2027, and robotaxis with Uber in 2028.The Verge: “first to its own employees for testing and validation in 2026, and later to customers in 2027. Following that, Rivian says it will launch its first robotaxi vehicles in partnership with Uber in 2028.”
- SupportedScaringe uses the point-to-point system on his commute every day, called it a wonderful experience, and said autonomy could drive demand and long-term market share.The Verge: “Scaringe revealed that he has been using the new point-to-point driving system in his own commute to the office every day, calling it “a wonderful” experience. He continued: So, our view is that that is going to become a big driver of demand.”
- SupportedFinance vice president Derek Mulvey said autonomy is a primary product differentiator, market-share driver and long-term value creator.The Verge: ““We believe autonomy is a primary product differentiator, market share driver, and long-term value creator,” Derek Mulvey, VP for finance, said during the call.”
- SupportedTesla’s Full Self-Driving (Supervised) system is in more than 1.7 million active customer cars.The Verge: “Tesla has a huge head start with its Full Self-Driving (Supervised) in over 1.7 million active customer cars.”
- SupportedRivian is designing its own silicon chips, buying lidar sensors and paying for large-scale AI computing power while the R2 ramps up.The Verge: “while simultaneously designing its own silicon chips, buying pricey sensors, and paying for massive AI computing power — is a huge financial gamble, especially while Rivian is still struggling to build and sell its mass-market R2 vehicles at scale.”
- SupportedRivian warned that adding two processors and costly lidar sensors to some R2 models could eat into expected profits from building the vehicle at scale; chips, memory and electronics are getting pricier.The Verge: “the company pointed out that computer chips, memory, and electronics are getting pricier. It also warned that adding two processors and costly lidar sensors to some R2 models could eat into the profits it hoped to make by building the vehicle in large numbers.”
- SupportedRivian reported $605 million in third-quarter software and subscription revenue, up 45% year over year, and $256 million in software and services profit, up $102 million, at a 42% margin.The Verge: “Rivian reported $605 million in revenue from software and subscription services in Q3 2026, a 45 percent increase year over year. And Rivian brought in $256 million in profit in software and services, up $102 million from last year, with a strong 42 percent profit margin.”
- SupportedScaringe declined to give the Autonomy Plus take rate, saying it exceeded expectations and Rivian was encouraged by it; Tesla reported more than 75% of new North American buyers opted for FSD in the third quarter.The Verge: “The take rate on Autonomy Plus has exceeded our expectations,” he said, “and we’re quite encouraged by it.” Rivian’s execs are no doubt envious of Tesla’s take rates for FSD: Over 75 percent of new Tesla buyers in North America opted to get FSD in the third quarter of 2026, the company recently reported.”
- SupportedThe hands-free system may encounter edge cases and urban-driving complexity; a crash could harm Rivian’s brand, and the company will likely face legal challenges when things go wrong despite requiring active driver supervision.The Verge: “The point-to-point system will face its own hurdles, including edge cases and the complexities of urban driving. A vehicle crash could damage Rivian’s brand and reputation, just as Tesla has experienced many times with FSD. And even though Rivian intends to roll out the feature to require active driver supervision, the company will likely face legal challenges when things inevitably go wrong.”
- SupportedThe next year or two is Rivian’s riskiest period yet because it must fund expensive AI development while scaling R2 production, and it cannot afford to concede autonomy to Tesla and Waymo.The Verge: “To be sure, Rivian couldn’t afford to sit on the sidelines and concede the autonomous crown to Tesla and Waymo. Self-driving tech could help Rivian post big, software-company-style profits, but paying for expensive AI development while also trying to build the R2 at scale makes the next year or two its riskiest period ever.”
