Rivian CEO Explains Why Chinese EV Makers Are So Hard to Beat: 'The Capital Cost Is Zero'
Rivian Automotive Inc. (NASDAQ: RIVN ) CEO RJ Scaringe, during the automaker’s second-quarter earnings call on Thursday, shared his view on why Chinese auto companies were hard to compete against, and it all comes down to the cost structure. Chinese Cost Structure Differs From the US Scaringe was asked about how benchmarking Chinese platforms could help develop future Rivian products like the R3 and so on. The Rivian CEO said that Chinese vehicles, like Rivians, were probably purchased not just by automakers, but also by benchmarking companies to take apart. Read Also: Elon Musk Dismisses Report Tesla Could Sell Chinese Business for SpaceX Merger: 'Absurdly Fake News' He then said that there was not much of a difference in “how a Chinese vehicle is built relative to a vehicle built in the West in terms of the manufacturing approaches.” He added that methods...
Rivian Automotive Inc. (NASDAQ: RIVN ) CEO RJ Scaringe, during the automaker’s second-quarter earnings call on Thursday, shared his view on why Chinese auto companies were hard to compete against, and it all comes down to the cost structure. Chinese Cost Structure Differs From the US Scaringe was asked about how benchmarking Chinese platforms could help develop future Rivian products like the R3 and so on. The Rivian CEO said that Chinese vehicles, like Rivians, were probably purchased not just by automakers, but also by benchmarking companies to take apart.
, saying that there was a “much lower labor cost in China,” as well as a lower capital cost structure. “In many cases, the capital cost is zero, meaning it’s being provided by the local government,” he said. Read Also: GM CEO Mary Barra Says China's Price War Isn't 'Sustainable,' Backs Company's Autonomous Driving Efforts Amid Nearly $11 Billion in EV Charges The result is, according to Scaringe, a much lower production cost compared to the West. He then said these factors raise questions around supply chain strategy.
” Rivian’s Uber Partnership The CEO was also asked for his views about Rivian’s partnership with Uber Technologies Inc. (NYSE: UBER ), which he called “fantastic” during the earnings call and that the automaker was “encouraged” by the partnership. Scaringe said Rivian plans on deploying fully-autonomous Robotaxis across cities by 2028. Read Also: Uber-Backed EV Firm Says Iran War Is Accelerating Electric Vehicle Adoption in South Africa Rivian’s CFO and Executive VP, Claire McDonough, also shared that Rivian received an additional $250 million investment from Uber.
Rivian is targeting Level 3 eyes-off self-driving capabilities in its vehicles by 2027 and Level 4 robotaxi functionality in 2028. 51 billion. The automaker also recorded an EPS loss of 63 cents per share, beating a Street estimate of a loss of 74 cents per share. The automaker expects to deliver 65,000 to 70,000 vehicles for the full year.
Edge Rankings show Rivian scores well on the Momentum metric, while also providing a favorable price trend in the Short, Medium and Long term. 36 during overnight trading on Thursday. Read Also: Ford CEO Jim Farley Backs USMCA Overhaul, Says Deal Is 'Critical' to Compete With Japan, South Korea Check out more of Future Of Mobility coverage by following this link. com