Published on August 26th, 2018 | by Court Nederveld0
Electric Revolution, Rivian Automotive, & Our Interview With RJ Scaringe
August 26th, 2018 by Court Nederveld
Originally published on EV Obsession.
Six years ago, the then new electric vehicle revolution got off to a shaky start. Nissan and Tesla fired the first salvo at the legacy auto manufactures with their mass-produced electric vehicles. Nissan’s LEAF was an adjunct to the company’s gasoline car lineup. Tesla bet the farm on electric. Since then, the industry has had fits and starts, with some amazing technology and some mediocre compliance cars. However, gasoline car manufacturers and ancillary industries predict a major sea change coming if EVs are not stopped.
Change is the essential process of all existence
Henry Ford II, regarding Ford Motor Company, once noted: “We have a tremendous investment in facilities for (internal combustion engines, transmissions, and axles) and I can’t see throwing them away just because the electric car doesn’t emit fumes.”
More than half (62%) of global auto executives say they believe electric vehicles will fail commercially.
Carlos Ghosn, Renault CEO & Chairman, Nissan Chairman, and former Nissan CEO, noted, “Electric cars are not going to take the market by storm, but it’s going to be a gradual improvement.”
Former BMW Chairman of the Board Norbert Reithofer has stated, “It isn’t a given that the companies that provide mobility today will also be the ones to do so tomorrow. Every company has to work hard to make this happen.”
This piece by Brian Kent looks hard at the shuck and jive being played by the legacy OEMs as they game the electric vehicle system with compliance cars.
Perhaps Lee Iacocca said it best: “In the car business, you lead, follow, or get out of the way.”
The undiscovered country
On the positive side, there are some exciting new electric vehicle companies knocking on the door and not carrying the baggage that Mr. Ford II referred to. One such company is Rivian Automotive. The intriguing part of Rivian Automotive is that it has its sights trained not on Tesla or other EV makers, but at the heart of the old line internal combustion engine (ICE) manufactures.
RJ Scaringe is the Founder and CEO of Rivian Automotive, founding the company in 2009. Vehicle development is operating across three locations — Plymouth, MI; Irvine, CA; and San Jose, CA. Battery and vehicle production will be out of Normal, IL. This former Mitsubishi plant was shuttered in 2016 and purchased by Rivian for $16 million in January of 2017.
I reached out to Rivian Automotive to try to get a sense as to just how much meat is already on the bone.
1. Still on track with the 5-passenger electric pickup truck called the A1T and the 7-passenger electric SUV called the A1C sport utility vehicle?
We are on track with production and we look forward to revealing our first vehicles at the LA Auto Show in November.
2. Rivian Automotive is targeting Ford F-150, Land Rover, and Porsche Cayenne customers. What brought the conversation to taking on ICE vehicles as the target when so many other EV manufacturers position themselves as the Tesla killer? Example: Jaguar’s I-PACE is called a Tesla killer? GM’s Bolt was originally referred to as the Tesla Model 3 Killer?
Fortunately, the entire automotive market is moving towards EVs. The incumbent OEMs have started to plan future electric lineups, but these are generally focusing on the sedan and CUV segments. Some of these OEMs have started to create longer term EV plans that include other segments; however, there hasn’t been a focus on combining performance, utility and capability to create adventure-oriented offerings. Trucks and large format SUVs also represent the largest opportunity for reduction in carbon emissions on a per vehicle basis.
Price and range
3. Your electric vehicles are expected to list for around $50,000, with top of the line versions going for more than $90,000. Buyers will have a choice of an 80 kWh battery good for around 200 miles of range or a larger battery with a range of 450 miles. Are these numbers still looking doable? With battery costs dropping, might these performance numbers increase or the price drop?
We continue to make progress and our base model will have approximately 250 miles of range. We haven’t announced the specifics on our battery configuration, but the largest pack will deliver up to 450 miles in range.
4. As the vehicles get closer to launch date, will you be trying to utilize the manufacturer/dealership model to market them or the online direct-to-consumer model?
At launch, we will operate our own stores and sell direct-to-consumers. We are currently engaged in distribution partnership discussions to allow better access to several specific markets both within the US and internationally.
Just a better vehicle
5. With the traditional dealership model being a major stumbling block for the adoption of electric vehicles, I’m very interested in the thinking you’ve put into overcoming traditional anti EV marketing?
Our pure electric platform delivers levels of performance, capability and efficiency that are not possible with an internal combustion powertrain.
6. The chassis could be licensed to other companies to build their own cars around. But the big plans involve the Rivian AI controlled batteries. Can you elaborate more on the batteries? Liquid cooled? Solid state?
We will share details on our battery technology at a later date.
Recipe for success
7. Will the Normal, IL plant be the battery manufacturing location as well as vehicle assembly or will you farm out the battery production to a third party such as Panasonic or Samsung SDI?
The Battery Module and Battery Pack production line will be located in our plant in Normal, IL. This production line is being set up now and we have a R&D Pilot line that is currently operating in our Irvine development facility.
8. Have you begun negotiations with companies like John Deere to develop chassis and batteries for powering other types of electric vehicles such as school buses, tractors or forklifts?
Our skateboard platform and battery technology have been developed to support a range of applications beyond our own vehicles. At this time, we are not disclosing any details or information on the use of our technology with other companies.
The new shopping paradigm
9. Do you anticipate opening up a reservation and configuration portal as production gets closer to launch?
We will be opening a reservation process and will be announcing the details of this shortly.
10. Do you anticipate taking reservation deposits when production starts to ramp?
We will be announcing our pre-order reservations plans shortly.
How fast does it charge?
11. Will you be taking advantage of the public charging systems such as Electrify America or have you or are you considering a partnership with Tesla for use of the Supercharger network?
We will provide details on our charging strategy at a later date, which will certainly include leveraging the rapidly growing public charging infrastructure.
Transportation by subscription
12. Your website mentions offering certain subscription services: (great idea). Can you elaborate on what services are being considered?
We do not believe that the current level of personal vehicle ownership will continue into the future. Various forms of subscription or mobility as a service will allow consumers to access a diverse selection of vehicles and select the best solution for a given use-case (e.g. taking the kids to school, a formal dinner, a trip to the beach). Rivian Automotive will launch solutions that will enable consumers to meet their diverse mobility needs without having to own a Rivian vehicle — the details of our subscription services will be announced at a later date.
13. Will you control your own service centers or contract that to a third party?
We will detail our service strategy at a later date.
Leasing, a popular choice
14. Will leasing be an option at launch?
15. Do you anticipate an expanding rollout for delivery or will the vehicles be available nationwide?
At our launch, we will target our strongest markets in the United States and then expand from there, while simultaneously expanding internationally. We will share more details on this in the future.
Adventure space leader
16. What path do you envision to transform from an unprofitable niche player into a profitable major automaker?
Rivian Automotive is developing a highly differentiated product offering that targets a clear market whitespace. Our products will leverage exceptional technology and deliver a unique combination of performance, efficiency, capability and utility that is significantly better than the existing options. This will enable Rivian to firmly establish itself as the de-facto leader of the adventure space and provide us with a solid brand platform for future growth. We will also leverage our vehicle platform and battery systems to address a range of applications beyond our own vehicles, which will further position Rivian as a major player in the sustainable mobility space.
Clean and lean manufacturing
17. Any idea of an estimated vehicle production volume needed to be sustainable and viable?
We are not disclosing break-even production volumes for our portfolio. Our manufacturing system and platform allow us to achieve profitability at lower volumes than a traditional manufacturer.
Electric vehicles, a key role to play
18. Any other points you would like to make? The market for EVs is expanding rapidly. We need more companies like Rivian Automotive to step up and make this transition happen sooner rather than later.
Rivian is working from a clean slate, without legacy and portfolio limitations, and is in the unique position of understanding changing customer dynamics — the shift from vehicle ownership to mobility as a service. Rivian has the talent and resources needed to manufacture vehicles at scale — top team of engineers and executives combined with a 2.6 million square foot fully functional manufacturing facility in Normal, IL.
Rivian has built its organization to be lean and fast, with processes and structures designed to allow the team to quickly adapt to market shifts, new technologies and business models. Rivian is confident that it has a key role to play in the mobility industry of the future.
Best laid plans
In the EV world, nothing ever proceeds exactly to plan. Rivian Automotive is targeting electric vehicle production for 2020. If they can meet that goal, they have some very juicy targets to aim at. Ford sold 900,000 F-150 in 2017, Porsche sold 6,000 Cayennes, and Land Rover sold 75,000 vehicles in 2017. With the incumbent legacy manufactures reluctant to imperil their ICE empires, Rivian Automotive will have an excellent opportunity to capture market share.
If it walks like a duck…
Is Rivian an auto manufacturer or a technology company or a tech company building automobiles?
I checked Glassdoor to see if any of the 350 employees could shed some light on this question. One comment seemed to sum it up:
– Never a dull moment
– Developing new technology with a highly efficient team
– Fun work culture where everyone is contributing to the success of the program
– Fast paced environment where progress can be measured daily instead of quarterly
– Not bogged down by bureaucracy
– Each employee has a great deal of responsibility to contribute to the team
I don’t believe the electric vehicle revolution is dead. I suspect that if we watch places like Detroit, Wolfsburg, or Tokyo for the future of EVs, we’ll miss its arrival from places like Normal, IL.
Photo credits: Rivian Automotive