Rivian’s bet on autonomy faces its first real test

During an hour-long earnings conference call last night, Rivian CEO RJ Scaringe spent less time talking about the production ramp for the all-important R2 SUV than touting the company’s still-unproven autonomous vehicle ambitions.

But the company will face a crucial test later this year, when it rolls out its point-to-point hands-free driving feature — first to its own employees for testing and validation in 2026, then to customers in 2027. Next, Rivian says it will launch its first robotaxi vehicles in partnership with Uber in 2028. In short, the next two years will determine whether Rivian succeeds or fails in its high-stakes quest to become an autonomous player in full part.

“We believe autonomy is a key product differentiator, market share driver and long-term value creator,” Derek Mulvey, vice president of finance, said on the call.

Success is not guaranteed. Tesla has a huge head start with its fully autonomous (supervised) driving in more than 1.7 million active customer cars. But trying to match Tesla’s driver-assistance features — while designing its own silicon chips, buying expensive sensors and paying for massive AI computing power — is a huge financial gamble, especially since Rivian still struggles to build and sell its consumer R2 vehicles at scale. (The R2 recently became Rivian’s best-selling vehicle by volume, so progress continues.)

But it’s unclear whether Rivian sees the R2 as its breakthrough vehicle or whether the autonomy resolution will be the real decider. That leaves the company in the middle of a difficult balancing act: launching an ambitious electric vehicle aimed at the mass market while simultaneously reinventing itself as a powerhouse of autonomous driving in its own right.

Of course, the feature itself must work for Rivian to be successful. During the call, Scaringe revealed that he uses the new point-to-point driving system to get to the office every day, calling it a “wonderful” experience. He continued:

So we think that’s going to become a big driver of demand. And I think it’s not clear how quickly the whole – you know, the whole US market and the whole auto market – starts to actually want that, and for that to be a major purchasing criterion. But we’re certainly at the beginning of an inflection point where more and more people are exposed to what this could do… We think it’s a very important factor, long term, for our market share.

But Scaringe was suspicious about other details. Asked about Rivian’s opt-in rate for its Autonomy Plus package — in other words, what percentage of Rivian buyers who purchase or subscribe to the software compared to the total customer base — the CEO declined to share the exact number. “The participation rate for Autonomy Plus has exceeded our expectations,” he said, “and we are very encouraged.”

Rivian executives no doubt envy Tesla’s FSD buy-in rates: more than 75% of new Tesla buyers in North America have opted to get FSD in the third quarter of 2026, the company recently reported. Meanwhile, Rivian reported $605 million in revenue from software and subscription services in the third quarter of 2026, a 45% year-over-year increase. And Rivian generated $256 million in software and services profits, up $102 million from last year, with a strong profit margin of 42%.

Rivian will likely spend more money than it brings in as it continues to buy expensive computers and AI systems. On the call, the company emphasized that computer chips, memory and electronics are becoming more expensive. It also warned that adding dual processors and expensive lidar sensors to some R2 models could reduce the profits it hoped to make by building the vehicle in large numbers.

The point-to-point system will face its own obstacles, including edge cases and the complexities of urban driving. A vehicle accident could harm Rivian’s brand and reputation, just as Tesla experienced multiple times with FSD. And even if Rivian intends to roll out this feature to require active driver supervision, the company will likely face lawsuits when things inevitably go wrong.

Certainly, Rivian couldn’t afford to sit on the sidelines and concede the autonomous crown to Tesla and Waymo. Autonomous technology could help Rivian achieve big profits, comparable to those of a software company, but paying for expensive AI development while trying to build the R2 at scale makes the next year or two its riskiest period ever.