Rivian Automotive, Inc. (RIVN) has taken a major step to clear its legal slate, agreeing to pay $250 million to settle a class-action lawsuit tied to its 2021 IPO. With that significant legal overhang now almost cleared, the EV maker is at a critical turning point, potentially freeing up management to refocus on growth, execution, and market rebound. For investors, this settlement may mark the beginning of a new chapter. RIVN stock gained 1.32% on Thursday and added 0.31% in after-hours trading.
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Rivian Settles for $250M, Denies Wrongdoing
The lawsuit argued that when Rivian went public in 2021, it hid the fact that its EVs were priced too low, which later forced the company to raise prices in a way customers didn’t like. The claims were filed in 2022 on behalf of buyers of Rivian’s Class A common stock.
Despite the lawsuit’s claims, Rivian maintains that it did nothing wrong and that settling the case does not imply any admission of fault. Meanwhile, the proposed settlement still needs court approval. The company plans to pay the $250 million through $67 million from directors’ and officers’ insurance and $183 million from its own cash reserves.
Rivian Gears Up for R2 Launch
Rivian has agreed to pay $250 million to settle an investor lawsuit, saying it wants to put the legal issues behind it and focus on the future. The company believes this settlement will let it concentrate on launching its mass-market R2 vehicle in early 2026.
Best known for its R1S SUV and R1T pickup, Rivian is now preparing to introduce the more affordable R2, aiming to reach a broader range of buyers. This comes at a time when U.S. demand for EVs is slowing following the expiration of the EV tax credit. Consequently, the success of the R2 is seen as vital for Rivian’s survival. The first deliveries are expected later in 2026, with the company targeting around 50,000 vehicles for the year.
At the same time, Rivian is reportedly trimming costs and reducing its workforce by about 4% to manage tariffs on auto parts and the overall EV market slowdown.
Is Rivian Stock a Buy?
Turning to Wall Street, the analysts’ consensus rating for RIVN stock is Hold, based on 7 Buys, 10 Holds, and five Sells assigned over the past three months. Meanwhile, the average RIVN price target of $13.69 indicates over 4% upside from the current level.
