While the electric vehicle (EV) industry remains challenged and continues to grapple with massive overcapacity and tepid demand, it still attracts interest. Earlier this month, Uber (UBER) announced that it would invest up to $1.25 billion in Rivian (RIVN) and buy up to 50,000 of its upcoming R2 vehicles for its robotaxi fleet.

Notably, last year Uber also entered into a similar partnership with Lucid Group (LCID), but the scale was much lower than what it has now announced with Rivian. In 2024, Volkswagen (VWAGY) announced that it would invest up to $5.8 billion in Rivian and form a joint venture with the U.S. EV startup.

Rivian Has Secured Funding From Several Parties

As I have noted multiple times, Rivian and Lucid are two of the EV startups that have the wherewithal to survive the current EV industry slump. Both offer quality products and have their own manufacturing operations. Also, investors have been willing to fund their burgeoning losses. While Saudi Arabia’s Public Investment Fund (PIF) has been doing the bulk of the heavy lifting for Lucid, Rivian has relied on outside funding.

Apart from Uber and Volkswagen, Rivian also secured a $6.57 billion loan from the U.S. Department of Energy. These capital raises have helped strengthen Rivian’s balance sheet at a time when the operating environment has been quite challenging. Along with low demand, the auto tariffs and the easing of fuel economy standards are taking a toll on industry profitability. For startup EV players like Rivian, it is adding to the losses while making the path towards sustainable profitability even more cumbersome.

RIVN Stock Forecast

Sell-side analysts have held divergent views on Rivian despite the strong Q4 2025 earnings report and the recent partnership with Uber. Last month, Deutsche upgraded RIVN to a “Buy” and raised its target price to $23, while UBS upgraded it to a “Neutral” and raised its target price to $16. D.A. Davidson, meanwhile, downgraded the stock from a “Neutral” to “Underperform” while slashing its target price by $1 to $14.

This month, TD Cowen joined the bullish gang and upgraded Rivian from a “Hold” to “Buy” while raising the target price from $17 to $20. Bank of America, however, reinstated coverage on the stock with an “Underperform” rating and $14 target price.

This dichotomy in analyst opinion is not that difficult to comprehend. There is optimism about the launch of R2 vehicles, which are expected to give a fight to Tesla's (TSLA) best-selling Model Y. Tesla’s decision to stop production of its premium Model X is also a positive for Rivian, as it would lower the competition in the premium electric SUV market and help its R1S gain market share.

Rivian has proven its mettle with execution and churned a gross profit last year, which is no mean achievement given the state of the EV industry. The company is also progressing on autonomy and held its AI and Autonomy Day last year. Incidentally, the R2 vehicles that Uber will deploy in its robotaxi fleet will be powered by Rivian’s autonomous technology, unlike the deal with Lucid, where Nuro will provide autonomous technology in the three-way partnership.

Meanwhile, the bearish side of the argument also holds weight, and despite all the improvements and cost cuts, Rivian is still posting losses and burning cash, and there looks to be no near-term respite from these. The company’s lucrative regulatory credit business might also remain under pressure as legacy automakers don't necessarily need to buy these following the easing of Corporate Average Fuel Economy (CAFE) standards by the Trump administration.

While some are bullish on the upcoming affordable R2 vehicles, that segment is expected to witness intense competition in the coming years as companies across the EV spectrum—from U.S. EV giant Tesla to fellow EV startup Lucid Motors and even legacy automaker Ford (F)—are doing the same thing.

All said, I remain neutral on Rivian and align with the average sell-side analyst covering RIVN stock, as while the company ticks all the right boxes for an EV startup—a good product, credible management, and a strong balance sheet—I don’t find the price attractive enough to add to my existing positions, much of which I had exited last year after the rally.

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