Image Source: Pixabay

Rivian stock (Nasdaq: RIVN) dropped about 8% intraday on Thursday, amid rising investor concern over the expiry of  $7,500 federal electric vehicle (EV) tax credit.

The slip came despite a modest upward revision in deliveries as the company reported Q3 deliveries of 13,201 vehicles and production of 10,720, with a narrowed 2025 delivery guidance of 41,500–43,500 vehicles.

Rivian stock seems to be facing near-term pressure from the federal EV tax credit’s expiration and elevated tariffs.

Rivian stock: Why the tax-credit cliff matters?

The $7,500 federal EV tax credit was a big reason why so many people were snapping up Rivian stock, as it basically made the upfront cost or monthly lease payments much easier to manage.

But now that the credit expired on October 1, that extra financial boost is gone, and buying or leasing a new EV isn’t as tempting.

Usually, when the credit disappears, leasing activity drops because monthly payments go up, and overall demand softens.

That’s why we saw a rush of customers in Q3 trying to lock in the credit before it vanished, and it also means Q4 sales are likely to feel a bit weaker.

In Q3 2025, Rivian produced about 10,720 vehicles but managed to deliver 13,201, just a bit above what analysts were expecting.

A lot of that came from clearing out inventory that had built up in previous quarters.

Looking ahead, the company narrowed its 2025 delivery forecast to 41,500–43,500 vehicles, down from the earlier 40,000–46,000 range, showing that Rivian is being cautious given the broader economic uncertainties.

On top of that, higher tariffs on imported parts, adding a few thousand dollars per vehicle, and ongoing supply chain hiccups are putting extra pressure on costs and margins.

When you combine that with the tax credit expiring, it’s clear that profitability is going to be a tougher nut to crack in the near term.

Can R2 save the story?

Rivian’s new R2 model, a more affordable SUV set to launch next year, could be a game-changer for the company.

The idea is to attract a wider range of customers beyond the current R1 series and help steady demand.

Analysts see the R2 as a potential long-term solution to offset the short-term slowdown caused by the expired tax credit and other market pressures.

Of course, how well it works will depend on how smoothly Rivian can ramp up production and how it stacks up against competitors. For now, the company is focused on managing today’s cost challenges and navigating a tricky market.

What investors should watch next?

There are a few key things to watch for Rivian in the near term. The company’s Q3 2025 earnings report, coming up on November 4, will give a clearer picture of financial performance, costs, and how the production ramp is going.

Investors will want to keep an eye on margin trends, especially with those tariffs affecting costs, as well as updates on how ready the R2 is for production.

Any new policy changes that impact EV incentives or tariffs could also move the needle. All of these factors will play a big role in whether Rivian can win back investor confidence after a rough patch.

More By This Author:

Tesla Shares In Green After Beating Q3 Delivery Estimates
Here’s Why The Gold Price And Swiss Franc Are Soaring This Year
Asian Markets Open: Kospi Soars Over 3% To A Record High On OpenAI Chip Deal