Rivian and VW have lately opened a partnership, regardless of the manufacturers have very related upcoming electrical journey automobiles with the Rivian R2 and VW Scout. However at a roundtable dialogue with Rivian’s CEO RJ Scaringe, he stated 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 attention-grabbing questions on how the small print of the partnership would work out.
On the prime of many individuals’s minds has been: isn’t it just a little 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.
Typically, feedback ran alongside the road of Rivian working to deliver its software program experience to bear throughout VW’s manufacturers, although the 2 firms have been just a little shy to verify whether or not Scout particularly would use Rivian’s software program. In spite of everything, Scout is a little bit of a by-product from VW, and appears fascinated about displaying some independence on that entrance, so it could possibly be attainable that they work on their very own.
However in feedback at a roundtable which Electrek attended right now forward of the LA Auto Present, it actually appeared that Rivian might be engaged on Scout automobiles. Scaringe stated that “we’re going to be supporting their full portfolio of manufacturers – Porsche, Audi, Volkswagen, Scout.”
Nevertheless, extra importantly, Scaringe stated that he’s “amused” by the main target 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 out there right now – and that’s maybe being charitable. In the meantime, in the event you go over to the fuel world, there are gobs of decisions on the market for customers, and but all of them handle to coexist with out situation.
So Rivian has labored exhausting to differentiate itself from Tesla, for instance, and thinks that even when Scout is impressed by Rivian, there’s nonetheless room for related 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 firms. Simply within the EV area, the Kia EV6 and Hyundai Ioniq 5 share a platform, and the Subaru Solterra and Toyota bZ4X are mainly equivalent automobiles. So there was loads of historical past of firms working collectively to come back out with related or near-identical (rebadged) vehicles.
That’s not the case right here, as Scout and Rivian might be very completely different by way of platform and manufacturing. However sharing software program shouldn’t be a lot of a difficulty – and even if we assume that Scout might cannibalize a phase of the market that Rivian in any other case had a superb maintain on, Rivian can nonetheless profit from the partnership regardlessl.
Rivian’s essential focus in recent times has been getting prices down. The story is that Rivian started scaling manufacturing in a particularly troublesome time – attempting to prepare provide contracts on the historic peak of the auto business (~2018), attempting to start out a producing program throughout a world pandemic (2020/2021), and having little clout obtainable to get on the higher facet of these contracts.
Now, Scaringe stated, 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 fuel manufacturers – however it could additionally tout that it has assist from one of the established auto producers on the earth, Volkswagen. If VW – the second-largest automaker on the earth – has sufficient religion in Rivian to speculate $5.8 billion, then absolutely a provider can belief that Rivian will stick round lengthy sufficient to purchase multiple set of components.
Not solely that, however the firms might doubtlessly leverage their mixed measurement for bigger provide contracts. Say a sure microcontroller is required for automobile structure throughout Rivian and in addition 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 may attempt to see if VW’s international gross sales community might assist them to promote Rivians, however Scaringe shut that down, saying there may be “no curiosity” in doing so. Rivian would quite persist with its plans of organising its personal shops and doing direct gross sales.
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