Rivian and VW have just lately opened a partnership, regardless of the manufacturers have very comparable upcoming electrical journey automobiles with the Rivian R2 and VW Scout. However at a roundtable dialogue with Rivian’s CEO RJ Scaringe, he mentioned there’s greater than sufficient room for the manufacturers to coexist with one another.
Latest information about Rivian and VW’s software program partnership, with VW investing over $5 billion into Rivian and forming a three way partnership to undertake Rivian’s zonal structure for the underpinnings of VW’s automobile communications, has led to some fascinating questions on how the small print of the partnership would work out.
On the high of many individuals’s minds has been: isn’t it a bit bizarre that the Rivian-like Scout model will now basically be competing with itself for the journey EV market?
The query has been answered earlier than – or maybe extra particularly non-answered – in press conferences across the official opening of the three way partnership final week.
Usually, feedback ran alongside the road of Rivian working to deliver its software program experience to bear throughout VW’s manufacturers, although the 2 corporations have been a bit shy to substantiate whether or not Scout particularly would use Rivian’s software program. In spite of everything, Scout is a little bit of a derivative from VW, and appears all in favour of displaying some independence on that entrance, so it might be doable that they work on their very own.
However in feedback at a roundtable which Electrek attended as we speak forward of the LA Auto Present, it definitely appeared that Rivian will probably be engaged on Scout automobiles. Scaringe mentioned that “we’re going to be supporting their full portfolio of manufacturers – Porsche, Audi, Volkswagen, Scout.”
Nevertheless, extra importantly, Scaringe mentioned that he’s “amused” by the main focus that many have had on Scout, or those that think about it a possible menace to Rivian.
Scaringe estimates that there are “lower than 5” compelling EVs obtainable for beneath $50k available in the market as we speak – and that’s maybe being charitable. In the meantime, for those who go over to the gasoline world, there are gobs of selections on the market for customers, and but all of them handle to coexist with out concern.
So Rivian has labored laborious to differentiate itself from Tesla, for instance, and thinks that even when Scout is impressed by Rivian, there’s nonetheless room for comparable automobiles to coexist.
In spite of everything, there are lots of competing automobiles in lots of classes – a few of which do certainly share underpinnings from separate corporations. Simply within the EV house, the Kia EV6 and Hyundai Ioniq 5 share a platform, and the Subaru Solterra and Toyota bZ4X are mainly similar automobiles. So there was loads of historical past of corporations working collectively to come back out with comparable or near-identical (rebadged) automobiles.
That’s not the case right here, as Scout and Rivian will probably be very totally different by way of platform and manufacturing. However sharing software program shouldn’t be a lot of a problem – and even when we assume that Scout might cannibalize a phase of the market that Rivian in any other case had a very good maintain on, Rivian can nonetheless profit from the partnership regardlessl.
Rivian’s primary focus lately has been getting prices down. The story is that Rivian started scaling manufacturing in an especially tough time – making an attempt to prepare provide contracts on the historic peak of the auto business (~2018), making an attempt to start out a producing program throughout a world pandemic (2020/2021), and having little clout obtainable to get on the higher aspect of these contracts.
Now, Scaringe mentioned, the state of affairs is healthier: not solely can Rivian present that it has a dominant place in its class – promoting extra premium SUVs than different EV and even gasoline manufacturers – however it might probably additionally tout that it has help from one of the crucial established auto producers on the earth, Volkswagen. If VW – the second-largest automaker on the earth – has sufficient religion in Rivian to take a position $5.8 billion, then absolutely a provider can belief that Rivian will stick round lengthy sufficient to purchase multiple set of elements.
Not solely that, however the corporations might probably leverage their mixed dimension for bigger provide contracts. Say a sure microcontroller is required for automobile structure throughout Rivian and likewise VW’s manufacturers, then maybe the three way partnership might acknowledge a lot bigger economies of scale.
The query additionally got here up over whether or not Rivian would possibly attempt to see if VW’s international gross sales community might assist them to promote Rivians, however Scaringe shut that down, saying there’s “no curiosity” in doing so. Rivian would quite stick with its plans of organising its personal shops and doing direct gross sales.
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