03:58 PM EST, 03/07/2024 (MT Newswires) -- Shares of Rivian Automotive ( RIVN ) soared on Thursday as the electric vehicle maker announced a new midsize sport utility vehicle that will sell for nearly $25,000 below its first-generation truck in a market that has been stuttering amid lackluster EV demand.

Rivian announced the five-seat R2 SUV that is expected to sell at a price starting around $45,000 and the R3 midsize crossover that will be priced even lower. The vehicles will feature two battery sizes, with the larger pack capable of achieving more than 300 miles of range on a single charge. Deliveries of the R2 are expected to begin in the first half of 2026 with the R3 and R3X following.

The stock advanced nearly 14% ahead of market close on Thursday.

R2 and R3 will make "Rivian vehicles more accessible to more people," with its development teams focused on cost, the company wrote in a statement. The R1T pickup truck is listed for $69,900 on the company's website.

The company said it plans to shift production of the R2 from Georgia to its plant in Normal, Illinois, a move that is expected to save $2.25 billion. Rivian said it will resume construction on the Georgia plant "later."

EV demand continues to decelerate despite continued price cuts, while fleets have dumped EVs in favor of hybrid vehicles in order to meet customer demand, Morgan Stanley said in a note earlier this week. At the time, the brokerage cut its price target on Tesla (TSLA).

Last month, Rivian reported stronger-than-expected revenue of $1.32 billion for its fourth quarter ended Dec. 31, climbing from $663 million the year earlier. It had previously posted weaker-than-expected delivery data for the quarter with deliveries skidding on a sequential basis.

After Rivian released its quarterly results, UBS downgraded the stock to sell from buy and axed its price target amid tepid demand for US battery electric vehicles.

Rivian in February guided for flat year-over-year production of 57,000 units this year.

Price: 12.51, Change: +1.48, Percent Change: +13.42