Rivian CEO RJ Scaringe on the Future of Rivian, EV Sports Cars, and Depreciation! THIS CAR POD! EP73

[Music]

Hello and welcome to this car pod. I'm

Kenneth. I'm Philipe.

>> And today we have a special guest, Riven

CEO and founder R.J. Scarring.

>> Thanks for having me.

>> Welcome RJ.

>> Thank you for joining. This is a big

deal for us.

>> Huge.

>> We're sitting here at the Quail Motor

Sports Gathering or something. And we're

at the Rivian booth where we have all

sorts of Rivians around us. and we're

going to talk cars and we're going to

talk Rivian.

>> So, thank you for coming.

>> We got a whole big show

>> and we're going to start as we always do

with the news. You want to start?

>> Yeah. First, we're going to talk about

the quail in general. We've been walking

around all morning. Are there any good

reveals so far that you've seen?

>> Well, first thing point I want to make

is this has kind of become like the new

Geneva Motor Show. There's so many

reveals that are just happening. This

was just kind of an enthusiast show for

a long time and now it's like the place.

There's so many different manufacturer

releases. There's Bugattis. There's an

Acura.

>> Uh, Chevrolet revealed the CX concept,

which is the future of the Corvette.

>> Future of the Corvette. It's got a

cockpit that comes off. R.J., have you

seen anything that you like here so far?

Aside from the Rivians, which we'll get

to,

>> of course. Yeah, the Rivians look nice.

Um, it's funny. I was walking with my my

three sons, 976 age, and they're looking

around. They're saying, "Hey, Dad, is

that cool? That's cool." And I'm like,

"That's not cool. This is super cool."

>> Okay. Now, so what do we tell them now?

Oh, now we got to get into it.

>> What do we tell them is not cool?

>> Uh, other electric cars.

>> There's some beautifully, you know,

there's like wonderful historic vehicles

that are here and they're just, you

know, the the kids just walk by it and

I'm like, hey, that's that's right.

>> That's a 275 GTB. Like, take a second,

look at it.

>> Uh, and then they'll see some highly

modified thing and ask me about that and

I'm like, no, that's probably attention

to

>> man. Man, after my own. That's great.

Did Did they Were they excited about

seeing 17 different Ferrari F50s or like

after one or two were they bored?

>> Yeah, after one I think they were.

>> To be honest, I was too.

>> The F50 thing is crazy. They're

>> there legitimally 17 on the other side

of the line.

>> There's like 17 Shelby GT 350s which I

know is more up your alley.

>> Yeah.

>> Um Okay. So, but we want we're talking

news here and have there been any

specific debuts? There was the Bugatti.

>> Yes. So, the the Yes. So, the Bugatti is

the actually more the reveal of a

program. So, it's called their solitire

program where they're making oneoff cars

and which they've done before. But the

thing that was interesting to me, this

one's called the Bullyard, which is but

it's based on the engine is the W16. So,

the new car has the V16, but they're

continuing this W6.

>> That's based off the previous car.

>> Yes. And they're but they're going to

continue to use that for this program,

which I think is very interesting.

>> There is a new Lamborghini.

>> Is there? I thought it was like a

special edition.

>> It hasn't been revealed yet. Well, yeah.

I mean, it has an hour ago there. I

couldn't see it. We bumped into the

Lambo guy this morning and he said,

"Here's what it is. Here's what it's

called. But don't tell anybody I told

you that for another hour,

>> right?

>> I guess it's but what is it?" This, by

the way, doesn't come out till Sunday.

So, you're good.

>> Oh, okay. All right. There's no embargo

on this.

>> Just Just for clarity.

>> What is it called? The Phenomeno,

>> I think. So,

>> we haven't spent enough time.

>> We were busy. I was distracted by F50s.

>> The reveal that I'm most excited about,

of course, is the Acura RDX. No, so

sorry. RX. No, not the RDX. RSX, which

is a small EV SUV concept. You you must

be very frightened as as a maker of EV

SUVs.

>> I don't know, frightened. I think it's

great to see great to see things coming

out. Yeah,

>> this is a special event where there are

a lot of very cool cars being shown, and

those are a few of them. There are

others. I haven't checked out this

Corvette thing. They literally just

pulled the the wraps off it, so we'll

have to do that later. But that is kind

of our interesting uh vehicle news at

Quail, and there's still more happening.

>> Well, it's fun to be here. It's like

again it's kind of replaced motor show.

So it's cool to see it up close and be

around for it.

>> It's my first time here and it's wild

just to see both the cars that are here

generally your count included and then

what they're revealing and it's

automakers that I don't care about. Like

I care about the Rivian stand, the Acura

stand. Philip only likes the regular

brands. He's not into the

>> I'm into supercars. He's into regular

stuff and Doug is

>> and therefore this is not my event but

it is wonderful nonetheless.

>> Uh the parking lot here.

>> The parking lot very special. That's the

best.

>> It's really enjoyable. Yeah. Uh, in

fact, there is actually a parking lot

best in show award which you can vote

for. You go into the parking lot, you

take a look out there and you can write

in a thing and submit it somewhere.

>> May have cast my vote for an E39 M5.

>> There's a white two-door Mercedes wagon

with a

bizarre. It's like a It's like a wagon,

but it's a twodoor.

>> Some sort of custom thing.

>> Uh, okay. So, that's This is Quail News.

Let's talk industry news. Filipo, can

you can you give us some interesting

industry news? We have some real

questions for you. So, last week in the

podcast, we talked a little bit about we

filmed it right after Q2 results were

announced for for Riven, and we figured

we have you on the podcast this week.

You're the right man to ask. Uh,

obviously some increase in revenue

year-over-year. Q2. Uh, also a little

bit more more burn. What is the story

that you all are are telling around it?

What what led to that quarter

>> to to Q2?

>> To Q2. Yeah. Q2 is a challenge for us

because we had the significant drop in

production where um you if you look at

Q1 we produced around 14,000 vehicles in

Q2 we produced around six and the reason

for that significant drop was a lot of

really abrupt changes to the supply

chain and in our case we produce 100% of

our cars in the United States and of

course 100% of those are electric

>> so the export controls are on heavy rare

earth metals

>> yeah so effectively magnets

>> really hurt us because we we only make

electric cars and every electric car

needs magnets to make the motors. So,

um, we had to do a lot of work to come

up with a new supply chain and really

like dramatically shift how we were

sourcing a lot of material into our

motors. And so, we just had like a

abrupt slow down in production and you

know, the the nature of our business is

high fixed cost. So, the cost went up or

the cost stayed the same, but we weren't

you weren't spreading those costs across

a lot more volume. So,

>> uh, you know, we guided that the second

half of the year. We're going to

actually produce more vehicles in the

first half. Um, we think Q3 is going to

be a really strong sales quarter just in

part because of the ending of the $7,500

tax credit. So, a lot of folks are going

to be to get their EVs right now.

>> Are these trucks eligible? The R1T and

the R1S.

>> No, they are. So, under if you lease an

R1, you you qualify. So,

>> but yeah, so a bunch of sort of

compounding factors, but look, we're

couldn't be more excited. Uh we're uh

we're coming up on the launch of R2 and

R2 is for me you know R1 is like a labor

of many many years of love. R2's

benefits from an organization it's so

much more mature and so the everything

from how it's manufactured to how it's

serviced to the performance relative to

its cost is it's really really cool.

>> Yeah. I remember hearing was I was

reviewing the Q2 results that you guys

predict that tariffs will impact about

will cost about two grand or three grand

per vehicle you you sell which is

>> wild and I think we all often think

about tariffs as impacting cars that are

imported but as you said they're all

made in the US but it's still a

>> what 3% 5% to 5% impact depending on the

model that's notable. The other thing

about auto is I mean these you guys know

so well.

>> It's not um I think a lot of times we

talk about tariffs and we sort of equate

the economy to as if we're like buying

and selling t-shirts and coffee cups

like really simple supply chain.

>> These are really complex supply chains.

So we buy you take like our headlight.

>> We buy that as an assembly from a US

manufacturer

>> and it comes you know it's built in the

US. uh it has about 20 suppliers into it

and those 20 suppliers then each have

about 10 to 15 suppliers. So there's

hundreds of companies involved with

making our headlight and many of those

companies are getting materials that

come from outside the United States and

that's a one part, right? And so the the

ripple across something with such a

complex supply chain is is hard to fully

appreciate you realize we buy 3,000

parts, put them together, but there's

actually

>> more than 10x that in terms of discrete

components that are going into the carow

>> because we buy assemblies.

>> Um,

>> yeah. So it's, you know, it does despite

the fact that we're very US- ccentric

and we're very vertically integrated, it

still adds a few thousand in cost. One

of the things that we struggle with is

like we care a lot about the market. We

read a lot about the market, but we're

not deep in it. And I feel like one of

the hard parts is from the outside is

how do you actually figure out what is

tariffs, what is not? There's a lot of

changing rules. And I imagine as you're

thinking about suppliers, you've tried

to focus on as everybody every tech

company did, do I move production to

India instead of China, but now there's

additional tariffs there. Have you been

how have you been managing that?

>> I mean to your first question, the um

>> is there better? There is a there's a

daily standup meeting we have at within

Rivian that says like what's changed in

the last 24 hours uh which I didn't

anticipate having but every 24 hours we

we review what what has changed in terms

of trade policy tariffs

>> and so that informs like what are we

doing that day that week to react

>> and then there's a longer term strategy

that we're building and some of these

decisions are really hard so take uh

wiring harnesses very labor intensive

>> almost all of the wiring harnesses for

cars built in the United States or

manufacturer in Mexico because the much

lower cost of labor

>> and because till about four months ago

that was

>> and because we had standard you know

multi-deade North American free trade

agreement and so when that changed

everybody's like wow should we start

building wiring harnesses in the United

States

>> but then you don't want to like invest a

bunch of capital to build production

capacity then have the rules change

again in a couple of years

>> and then have a really expensive wiring

harness production line. So there's in

many cases there's decisions where we're

essentially saying we're going to

continue to source from a lower cost

location uh and just pay the tariffs in

the in the short term. You short-term

meaning next few years.

>> Yeah.

>> And then in some cases we've made the

decision to bring in you know bring into

the United States. But it's these are

hard trade-offs. is the assumption that

in a postpresident Trump world some of

these things go like are you operating

under that assumption generally that

maybe you're not going to have to worry

about this stuff soon and so it's not

worth that big investment for some of

this stuff.

>> Yeah, it's a it's a good question. I'd

say there's there's a we actually have a

like a live working memo and there's a

few categories in it. on is what are the

things we think are going to stay like

what's what are changes that are going

to be um you know sticky and then what

do we think is going to move around and

so one of the things that we think is is

going to be persistently with us in

terms of like the US economy is trade

policy that makes it very hard to do a

lot of business with China

>> sure

>> and so it's one of the few categories of

topics where the the left and the right

agree there's a very strong anti-China

trade mentality And so, of course, we're

not building supply chains that have any

reliance or dependence on China. One of

the ones we think is going to be moving

around a lot over the next few years is

trade within North America. And it's

been such a a pillar of our economy and

so much capex has gone into Canada and

Mexico.

>> Yeah.

>> That I it's hard to imagine a world

where we don't return to friendly trade

relationships with with our northern and

southern um neighbors. And and I think

that's generally the point of view. Most

companies believe that. And

>> so you're kind of operating with that.

>> And so we're not replacing Mexican

supply chains with US supply chains, but

we are very much making sure we don't

have China to kind of

>> Yeah. Which seems like a story we're

hearing from other other companies and

other auto.

>> You guys are also one of the few EV

manufacturers that hasn't developed a

China market product or focus on the

Chinese market generally.

>> We Yeah. So we actually didn't have a

lot of content out of China to start and

>> you know we' done a lot of the sourcing

activity on R2 in

like a lot of the contracts being

written in the summer of 2024

>> and it was pretty clear then

>> 6 months too soon. No, but even then you

could say like regardless who wins this

election,

>> like we're not going to go become really

close buddies, you know, the US and

China. So we we'd already made the

decision to not really rely.

>> Never mind that at the moment tariffs

are not that much more significant than

they are some other countries where you

may have expected different.

>> Um obviously tariffs been a big story

for us, but we want to move on to other

let's talk about uh Ford and Ford's

recently announced EV platform.

>> Yeah. So, Lyn, last week, Ford has

announced that they're planning on

building a $30,000 pickup truck. And

much more importantly, they are also

they they've announced this kind of new

production methodology where instead of

there being a single production line,

there's a bunch of different inputs that

then create one that flow into one

thing. Um, huge news for Ford obviously,

right? A $3,000 pickup truck, electric

pickup truck will be huge. They obvious

they refer to it as their Model T

moment. Yeah.

>> Uh, in reference to how popular will be

and to the factory line.

>> What do you think? First of all, Slate,

I have bad news for Slate and that that

might kill their market, but how are you

guys reacting to this? How are all of

you reacting to this?

>> Yeah, what are your thoughts? I mean, I

mean, obviously, this is it's an

interesting thing to hear about. You

know, the Machi was kind of already Ford

sort of entered in the segment, but it

seems like they want to go even higher

volume and even lower pricing.

>> Yeah, look, I I I say this all the time.

I think it's really important we have

choice.

uh you know, as a as a car enthusiast

and as someone that wants to see

electric vehicles be really widely

adopted where people are excited to be

in them, the only way we're going to get

there is if we have

>> more than a handful of, you know, highly

compelling choices. And and we see today

at the sub $50,000 price point, I'd say

there's, you know, more than one, less

than five highly compelling choices,

>> right? Yeah.

>> And and you could

>> I won't ask you which is

>> Yeah. Well, certainly two of them you

would clearly say are the Model 3 and

the Model Y and and they command

together around 50% market share

>> and that's not actually a good thing.

It's like it that's reflective of an

underserved market

>> when you have hundreds of compelling

choices in the ice world. And so I think

it's great that Ford's working on

>> you know a product that's going to, you

know, from the spec sounds really

compelling.

>> Yeah.

>> Um I think to do it you do have to

rethink architectures. you know there's

a lot of focus on the manufacturer

architecture. I think another element

that we're going to see that needs to

change is how we think about the network

architectures. So the topology of

compute and how software is architected

in the vehicles I think going to change

dramatically over the next you next 5 to

10 years and we've of course are driving

that within our vehicles right I mean I

I the biggest takeaway for me from that

new story is a lot of their what they

described as minimizing wiring work

changing the architecture for the car

itself despite it being 400 vol instead

of 800 volt is that that's exactly what

you all did with the gen 2

>> so I imagine you're all moving that

direction

>> totally I mean so we we have a

>> we have a large joint venture we put

together Volkswagen. So, it's a $5.8

billion deal and we're licensing our

what we call our zonal architecture and

our software stack.

>> But what that's really doing is it takes

what is on the order of call it 75 to

100 little ECUs, little electronic

control units that are domain based. So

they maybe are driving a window

mechanism or an HVAC system and instead

consolidating all that comput into a

very small number of computers and then

having all that decisioning and controls

driven by a single offer OS operating

system.

>> And so I think that's obviously the

future state, but it's it's going to

take some time to get there and it's

very hard to do.

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>> Yeah. I I have a lot of additional

questions, but I don't want Ken to

literally fall asleep. So, I want to

talk about the exact opposite of this.

>> Yeah. Which is Chrysler Chrysler and

Dodge, right? The Dodge announced it

this week or finally revealed, we've

known it's coming for a long time, the

Charger six-pack, which is the the

Hurricane V6 powered Charger. And

they've also announced that the Dodge

Durango is coming back with only V8s,

exclusively V8s,

>> despite the fact that they all they

claimed it was going to go out of

production.

>> Well, boy, that was quick.

>> Yeah. So, Ken's excited again.

>> Yeah.

>> Uh, this is an interesting situation

that's kind of been brewing. In addition

to what we're talking about with regards

to tariffs, now you have this sort of

sentiment in the consumer world sort of

shifting back. I don't want to say away

from electric vehicles because obviously

there's still a lot of interest there,

but

>> you know the Chrysler was seem to be

kind of going all in Stalantis on

electric cars and now maybe we want

>> electric vehicles.

>> Maybe we want engines again. Maybe we

want V8s again. um which is an

interesting thing to see and it's and

and it's it's also kind of driven by

what might end up being a temporary

shift in sentiment and in policy and

whatever but nonetheless this is kind of

happening

>> right I do feel for the manufacturers

cuz that level of whiplash is I mean

product cycles are designed so far in

advance and you know really has

obviously electric has become a way of

the direction that things are going so

to have to then all of a sudden change

again

it's kind of crazy

>> by the way they it's not like are

shifting. I mean, the Hurricane V6 is

new, but for a different product

initially for the Ram.

>> They're not bring out a new V8 for the

Durango or a new model for the Durango.

>> I would argue people don't want the new

stuff. They they actually what they

specifically wanted was the old engines

that made the big power and the big

torque and sounded like they do. What

are your thoughts on sort of a shifting

world of of consumer demand? Is this

permanent? Are we going back in the

direction of combustion engines?

>> V8.

We're not planning any V8s in the

Rivian. Alaska.

>> I think you're on the edge of your seat,

but

>> someone will do a swap it. Someone will

do that at some point. Someone will

figure it out.

>> Wheel would be a lot of work.

>> There was enough YouTube dollars out

there. Someone

figure it out.

>> That's a good first.

>> Someone put a V8 on a Cybert truck.

>> Yeah, but when you have 1,50 horsepower,

it's hard to beat that.

>> Well, no, you wouldn't be beating it.

You'd be downgrading the floor. But but

what do you think? I mean, it's an

interesting situation. Obviously, you're

noticing this as well.

>> Yeah, you said it. It's uh in the list

of things I I didn't expect, which

there's a long the list is growing. I

wouldn't have expected a lot of the

manufacturers that had started to really

lean into electrification to so quickly

lean back out and then reinvest in

engine programs, you know, vehicle

programs built around engine

architectures. Uh and you said it, I'm

sure it's challenging for the teams on

those programs.

>> I can't imagine,

>> but you can see why you they're

optimizing around the short term. Yeah,

>> there's clearly customers that can be

picked up through that. The hard

question uh you know for the

manufacturers and I think for us as as a

country and as as like an industry is

what does the 2030s look like? So the

end state is very clear and if you

underinvest in electrification

>> and rely in terms of profitability and

product uh desiraableness on sort of

your classic old hits if you will. Are

you going to find yourself unable to

compete when the world inevitably does

make that full shift? And so I I say

this all the time. I I really hope

everybody continues to lean into

electrification. I think more

competition is really healthy.

>> So you view this as a temporary shift.

You view this as this isn't this isn't

going to be something that lasts and

sticks around, but nonetheless, it's

happening currently. They're going after

this, but maybe they're making the wrong

decision, chasing short-term customers

and short-term revenue and not focused

on the long term.

>> Yeah. I think and these these are big

shifts. I mean it's a shift especially

for someone who's think if you've been

driving cars for 30 40 years you're it

was hard to lose the manual transmission

and then

>> we have not accepted that by the way

>> this that was a hard thing for someone

>> just to be clear

>> and then then it's like okay well I lost

manual transmission and then you lose

the engine and so there's there's a lot

of nostalgia enthusiasm

but that's quickly shifting away and

like now my kids are very biased but my

kids are like shocked when they're in a

car that you have to like change the

gears like that this is

>> wildly comp.

>> The next generation is already growing

up normalizing this.

>> Yeah. To them it's like wait so you have

the thing you have to do with your left

foot you know thing and like boy like an

Rivian it's so much faster you just go

uh

>> we nonetheless we do hear and it is it

is a lot of manufacturers who are saying

okay Porsche saying Macan V is not

selling TYON is not selling

Mercedes-Benz EQ is apparently being

pulled out of the the market um except

for the thousands of unsold cars that

they're going to still have to try to

put down. Is is does it make you at all

nervous that you know you're too early

like that that that the EV is still not

quite ready for the widespread world

that we were thinking maybe 5 years ago

we would be at?

>> Well, let me say this. I think it's I

actually think it's bad for the country.

I think it's bad for the US

competitiveness to have.

>> I agree. We've had this point on many

times.

>> US manufacturers not need to innovate.

like when you when you can rely on the

crutch of V8 SUVs or what what you've

made a lot of money with historically,

you're just not going to build the

muscle and the and the capabilities that

you need to in this this state in this

future state that's going to be needed

to be globally competitive. So I think

that's again

>> the US industry actually learned this

lesson once before but all those people

are gone.

>> Yeah.

>> So they're might end up having to learn

it again pretty

>> soon. I mean, when the Japanese came in

and then eventually the Koreans came in

and started really having a big effect

because they knew how to build a type of

car that the Americans weren't building,

which is a point that we've tried to

make a million times on the show cuz we

get a lot of comments, oh EVs are crap

and screw China, who cares? Well, if

China ends up showing up with these cars

that are far better than our cars,

that's a problem.

>> Our cars float, they bounce.

>> We're going to get to that.

>> I think Well, it's back. I think it's

like I'd said, I I wish this wasn't the

case, but it's hard to ignore that it

means less competition in the short

term. Y

>> and for pure play EVs, especially pure

play EVs that the brands are built

around electrification. So Tesla,

Rivian, it's it's definitely going to

create a positive tailwind. And so and I

think you see it, you know, perhaps most

pronounced just with what's happening

right now. There's a lot of

manufacturers have made cars that are

electric but that are not super

compelling and as and as a way to get

zero emission vehicle credits or to

lower their corporate average fuel

economy rather than buy credits from

Tesla or from Rivian and they've

incentivized those sales very heavily.

So you see like very wonky lease deals.

You can lease there's some electric cars

you can lease

incredibly well aware

>> Charger V. Have you not thought about

going and picking up a Charger for 99

bucks a month? It's like sort of like

wow for like 50 bucks I get a whole car

>> but that's going to go away

>> right

>> and so then you're going to be stuck

with a more like call it natural market

that's behaving based upon real

economics and then I think that the gap

between the folks that are not building

EVs

>> Yeah. So that's going to grow.

>> So the subject in your answer is you're

not nervous about uh that you're too

early. Quite the opposite. you think

you're well positioned for what will

inevitably happen and these other

automakers are maybe

>> the ones who are kind of screwing things

up.

>> Transitions like this are always tough

and it's there there's no of course

there's no direct analogy that's has all

the exact same things but if you go back

a long time peak horse was in the 1920s

>> you so like peak horse right before

there was no horse. Yeah.

>> Right before there was no horse.

>> Yeah.

>> Uh and

>> peak horse.

>> Yeah.

>> I like that.

>> How did we get peak? That's a great

>> And we are by the way at peak V8. I

think

>> big V8 as we should be. Okay, we're

peeking. That's the news. That's

interesting uh takes on the news.

Interesting to get your perspective on

some of the stuff that's happening. But

we got to move on to the talk car

segment wherein we talk about cars. Now

you're thinking we were just talking

about cars.

>> It's true.

>> We're going to really talk about really.

>> Can we still talk about wiring

harnesses?

>> No, we want to talk about R.J. We want

to talk about RJ. R.J. R.J. in addition

to the whole Rivian thing, which there's

more to cover there. R.J. is a car

enthusiast.

>> Yeah.

>> All right. What are what are your We

want to know what are you interested in?

What do you like? What do you drive?

>> You know, no manuals. His kids don't

know about transmissions.

>> You do you own one?

>> I do own one man.

>> Okay. What is it?

>> I have a Volkswagen Curado.

Awesome. You got a V a V6? Okay.

>> It's a And that's a It was the first car

I owned

>> and uh when I was when I first had it, I

modified the heck out of it. So, it's

beautiful. No, I sold it

>> and then I bought a Crowd of VR6 again.

>> Nice.

>> Wow.

>> Uh, so the kids enjoy it. They like it's

noisy. It

>> It's like so crude and they're tried to

understand like

>> Crowd VR6 had active arrow.

>> Yeah. Little spoiler. Okay, that is

interesting. That is a

>> I wouldn't say that.

>> Not expecting that one. That one.

>> If I had made a list of cars I thought

he would have that would have been near

the bottom of the list certainly. What

else do we drive? Obviously, you got

rigged. You're taking your kids.

>> R2s, R1's.

>> You're driving around R2s.

>> Wow. Yeah, there's uh camouflage R2s.

>> How come I can't drive? He's driving

around.

>> What am I?

>> You see, you saw one in person, though.

>> I did. I haven't.

>> So, is that it? You got Rivians and a

Curado?

>> Yeah.

>> Is that true? It's true.

>> What uh what cars have you owned in the

past?

>> I've owned uh all kinds of things. Um

>> I had a Lotus Elise, which was an

awesome.

>> You were also a taller gentleman.

It was hard to get in and out of, you

know, it's but that was just really

really fun car.

>> Uh 944S2. Great car. Really fun car.

>> Let's see. Um a 914 Porsche

>> 94 that I was doing.

>> So I I grew up restoring classic

Porsches and working on classic

Porsches. And so the 914 cuz I could not

afford the 356s I was working on.

>> So I bought the thing I could afford,

the 914.

>> I think most 914. Yeah.

>> I was doing this. It started as a

driving car and I made it not a driving

car, meaning it did not function because

I was in the process of doing a 993 3.6

conversion.

>> Oh.

>> So I had 911 turbo brakes on it. You all

the suspension pickup points on a 914

are the same as a 911 through 1989.

>> I didn't know that.

>> Yeah. Uh so it's very easy to do it like

a turbo brake kit cuz you just take out

the spindle.

>> Anyways, I um stopped that whole project

when I started riving. I started a much

bigger car project. So since I started

rigging, I haven't

Yeah, I haven't had any of those kinds

of car projects

>> and you probably don't have a lot of

time to go out and actually pursue these

sports cars and plus your whole life is

these cars and so just the Corano.

>> Yeah, but I mean like I'm like a as a

Porsche fan like a Porsche 993.

>> The running theme of all these cars

though is kind of smaller, lighter

weight, more

>> manual transmission analog.

>> However, the Rivians are kind of the

opposite. So, so what happened here? You

you saw what the market demanded instead

of what you yourself maybe were

interested. Well, when I first started

Rivian, we were working on a sports car.

Yeah.

>> And realized a couple years in that it

wasn't the right product strategy and

when you build a product, you have to

have like what's the story? What's the

brand? How does it resonate? And so, we

shelved the sports car recognizing it

wasn't the right thing to build around

and and that had been tried. Of course,

Tesla built its brand launching a

roadster.

>> Yeah.

>> And then spent a lot of time really

digging deep to say, what do we want to

build? What's the brand want to stand

for? Um, I'm a big uh adventure

enthusiast and so started to scratch on

this idea of a product designed to

enable adventure in the broadest sense.

Like it can fit your kids, your gear,

your stuff. Um,

>> and if you look at the types of vehicles

that are typically in that space,

they're very inefficient.

>> Yeah.

>> They're not fun to drive.

>> Um, they're you have to have basically a

lot of compromises in order to do those

things. And so we said, what if we made

a vehicle that was designed to enable

adventure, but also was super efficient,

incredibly fun to drive, had storage in

ways you didn't think about storage, you

know, so like a gear tunnel that goes

right through the side.

>> And so we landed on this idea of

building products around adventure.

>> When was this? What year was this?

>> This started in some point. You'd like

this, dog. I'll have to show you guys

the um all the things that happened

along the way, but it started in like

2013. And then we had many iter it's not

like we like

>> specifically going after truck like that

would you started focusing on truck in

that era.

>> Yeah. So we we recognized that trucks

had become big and a lot of the

positioning of them was around like who

can haul more concrete and who can haul

more stuff and a lot of the uses of the

trucks are very far from that. So

>> most people are using them actually to

put their maybe they put a sofa in the

back but they're largely using like

lifestyle. So your gear, your your

bikes, your

>> surfboard.

>> And so the first thing that we developed

that's actually still on this was this

idea of a gear tunnel

>> cuz there's the lack of a trunk in a

truck is a classic scenario where you

have a big bed, but you don't want to

put your groceries in the rain. Y

>> and so we put a big front trunk and then

a big middle trunk.

>> Um

>> it is it's interesting to me that this

was this idea was being developed that

early. Obviously in the years since then

it it worked out didn't like in the

years since then the the the 4Runner and

the Gwagon and the Raptor and like and

and co happened and adventure became an

even bigger thing and like you guys were

unbelievably well positioned in a way

that is

>> quite more than your competitors right

like a lot of your competitors debut

with sedans probably because they had

years of leadup of developing that sedan

but what turned out to be not what the

consumers were interested in like you

were perfectly ready with like an

electric 4Runner like it Well, it was it

was it was like ready to go when people

wanted it at the and and as a result,

Rivian has kind of been

>> the most desirable E. I mean, aside from

Tesla and Rivian are like up this is

what people want. This is like you think

about EVs people actually want. They

want to be heavily incentive brands

really resonated

in those vehicles specifically. I mean

it turned out to really work out like

you must have thought this is this is

perfect. But what was wild is we in like

2017 when things started to come into

real focus and the the vehicle started

to have look something like this. We we

made all these charts and we'd write

down like what do we want the brand to

stand for and you know you do these like

is is not uh and you'd ask yourself

these hypothetical questions would riv

do x

>> and we were really precise on it and

then we launched in end of 2018 and then

we products are on the market end of

2021

>> and it's actually come together a lot in

the way that we thought like we wanted

the vehicles to be used actively.

>> Yeah. We wanted people to connect with

them and like get inspired to go do

things that they may not do in their

existing vehicle. And so I get these

emails from customers that will say,

"Hey, I

>> I some you did something to me. I bought

your car. I hadn't skied in 10 years and

somehow me buying your car has me skiing

again." Like what what did you put in

the air filter?

>> That's cool.

>> Yeah. Which is like it's like so cool to

see your brand connect in the way you'd

hope.

>> And now R2 is going to bring it to more

people.

>> Yeah. and our 3X and R2 has some

features that just

>> Oh,

>> I'm so excited. There's a The rear glass

drops.

>> Yeah. 4Runner style.

>> And that's the only feature my wife

wants in a car. Actually, that and

CarPlay. So, it hits one of the two.

>> And there the there's rear windows that

pop out, which as a car enthusiast is so

cool.

>> Really cool. Sort of like a fresh air

mode. You press the button, use the

negative pressure off the top,

>> like the the rear 3/4 window.

>> Yeah. And then you pull air from the

through the car.

>> We've got to talk boots. Brunt Workware

boots. They've been a great partner to

this car pod, but I have been called out

in the comments for not being a boot

guy. Well, recently I headed to Belgium

for the Grand Prix at Spa, a notoriously

muddy place when it rains. I decided to

take my pair of Brunt Marin boots, and

everything I said about them in the last

podcast is true. They didn't take long

to break in. They were very comfortable,

and they kept my feet warm and dry when

the heavens opened at Spa. I also wore

them at the Bajjac forest, the site of

the fame stand of the easy company of

the 101st Airborne during Battle of the

Bulge. These boots allowed me to get

around the foxholes with ease and pay my

respects to the men who served there.

They helped me create a memory that I

will genuinely carry forever. The

founder, Eric Gerard, grew up blue

collar, worked alongside his buddies in

the trades, and kept saying that the big

brands had stopped caring. They had

turned into fashion brands and hadn't

changed in a hundred years. So Eric

built Brunt from the ground up for real

hardworking people. Every boot is named

after one of the guys that he grew up

with. Real people, real jobs. You can

literally wear them to work, beat them

up, and if they're not right for you,

send them back. Who else does that?

Brunt was tired of the work wear brands

that were cutting corners. You work too

hard to be stuck in uncomfortable boots

that don't hold up, so they built

something better. boots that are

insanely comfortable and are built for

any job site. So, for a limited time,

our listeners get $10 off at Brunt when

you use the code cars. That's C A R S at

checkout. Just head to bruntwork.com

and use the code cars and you're good to

go. And after you order, they'll ask you

where you heard about Brunt. So, do us a

favor and tell them you heard it from me

and this car pod. There's there was been

enormous pressure to launch R1 given all

the how long it took, you know, and the

investors and all that.

>> R2 though is going to be the real I mean

these these are expensive cars. R2 is

much more affordable. R2 is going to be

the big volume I imagine

>> for sure. So these have a average price

of over $90,000 and so

>> so R there's must be just I mean do you

feel just as much pressure trying to

launch R2 or like this is the big moment

where

>> it's it's a big Yeah. Yeah. It's also um

next year, early part of next year and

so

>> with with R1 is our first product and

out of the gate it resonated really

well. So we had like truck of the year

>> last couple years in a row, Consumer

Reports does this uh brand appeal study

and we've been at the top of the list

>> uh highest rate of repurchase. So all

these amazing

>> things that we only dreamed of. And so

now the hope is we can take this really

strong brand success we've had at this

premium price point at the you know at

the flagship level and take it into the

price point where you see things like a

Model Y right

>> you see like things like even as is sort

of normal if you will is like a Honda

CRV

>> you know Toyota Wranglers

>> certainly 4Runners of course so you pick

up just this huge

>> amount of market that's you know folks

are going to be cross shopping with a

lot of different things and so because

the price overlaps so much with the

Model Y. We often think we often get

asked like is this like directly trying

to compete with a Model Y? Of course,

there's going to be cross shop because

the price is there,

>> but really it's it's going to be

addressing the, you know, the vast

majority of folks that are actually not

buying an EV,

>> but when they see this, it's like, boy,

that thing's like faster than a Porsche

0 to 60. It's got this incredible

off-road capability. I can put my kids

in it.

>> Their window drops. It is almost

like

>> it's almost amazing the things that the

Caribbean vehicles combine into one. Um

>> this is not an ad for Raven by the way.

Just

>> I just I mean I was my car of the year

both the SUV and the truck where during

the years they came out and I think it's

pretty amazing the things they combine

into one. It's it's kind of an

interesting thing that you can do with

an electric car um is kind of make them

be fast and off-roading and luxurious

and all that. Um but nonetheless there's

you know there's is there an enthusiast

component of electric cars that's

missing? This is this is our friend

Kevin's thoughts here.

>> So yeah. So I I so you mentioned that

initially you were considering you

conceptualized having a sports car and

realized that was the wrong product

strategy which makes sense and obviously

Rivian's focused on like you said more

adventure stuff but how do you feel

about the electrification of sports cars

in general someone who said you know you

like the analog cars you love old

Porsches and the experience they own a

>> at least like looking at you know the

future of the sports car you know mate

rim has said very famously like

>> you need an engine for that experience

it's what customers of the ultra highend

stuff want you're going to pay over a

million dollars for a car you want it to

go when you start it. You want to feel

like feel that. So, what are your

thoughts on that?

>> Well, I think the customer for a million

dollar car is very different than the

car.

>> But what do you think the Porsches? I

mean,

>> Porsche is a great example.

>> Obviously, there's a lot of cool cars

that are electric, but are

>> are you as an enthusiast? You grew up

strong. Are you like worried about the

loss of

>> manual the manual flat 6, the air cooled

the in that segment at least?

>> It's a different flavor. And so so an

electric if you dream of like what is an

electric Porsche sports car look and

feel and drive like it's not going to

have all the same it's not going to hit

all the same buttons that

>> you know a manual transmission Porsche

is going to hit in the same way frankly

that like a 993 hits different buttons

than a new GT3 RS

>> like they're they're very different cars

and so

>> um

>> I think depending on your own history

with cars you may be drawn drawn more to

things that are more nostalgic or older.

Like so I'm actually drawn to like some

of those older cars just cuz they're

things I grew up with, things I grew up

dreaming about. You know, I know you

you're a big fan of your Courage GT that

like one of the last analog, you know,

really supercars. And so there's

something about that and I think when

you look at the sports car space putting

aside like the hypercar space because I

think it is a different customer

>> I think in the sports car space people

are going to find new ways to enjoy

electric vehicles and like regen is a

really interesting thing. Uh

>> and so you start to think about like

what role can regen play in in creating

another um driver accessible way to

control the the you know the vehicle and

you know coming into a corner. And so

there's I think just things we're going

to start to see that people think about

and dream about.

>> Have you driven that Ioni 5N that has

fake shift? We were we drove it and were

astonished by um how honest it was

feeling like a dual clutch shifting and

it really hit me that like if the

automakers start putting this in these

cars

>> that it kind of it does replace a manual

transmission experience but it sort of

replaces a dual clutch experience.

>> Yeah. I think what's funny about that is

it's replicating a less capable system.

And I think I think for for people like

that are maybe

>> enthusiast

>> enthusiast in the classic sense.

>> Yeah,

>> that works. I think there's going to be

new modalities though of of things that

are going to emerge on electric

vehicles. I think uh especially when you

start to look at like multimot multi

motor per axle.

>> I mean, have you you guys have just

drove up in the quad? We've done any

off-roading it. But

>> no, but

>> the new quad has some torque vectoring

features

>> that are so fun.

>> Yeah.

>> Like laugh out loud fun. We call it kick

steer where you're like driving on a

trail

>> and with

>> like it's like it's like Gran Turismo

easy. You just like press the buttons

and the car pivots on its axis. You can

make these right angle turns in a way

that you're just like you you're like,

"Wow, I feel like I'm a

>> you know a groupy rally driver here."

And it's so much fun and it's safe and

it's it's stable.

>> Does simulated shifting and torque

vectoring capabilities. Does that play

that same role for like the next

generation of enthusiast?

>> I mean, I don't know. I think

Lamborghini is already looking at that.

They were testing the Ionic 5 at the

factory to go see how it was put

together. I I think like there is

definitely something there. I felt like

that was the future of it for

>> but I I don't know. Like I it's I don't

know because I'm a dinosaur already.

Like I like V12 and manuals. That's what

I like. Yeah. But your kids, like you

said, grow up and they like are shocked.

>> But that's uh man, we talked about

horses jokingly. There are lots of horse

enthusiasts still. People that own

horses. It's it's a it is not the best

way to move around no longer. There's

much faster, more efficient ways to

move.

>> But people enjoy them and so they still

own them. And I think, you know,

hyperars, I think, are more in that

category. If you're going to if you're

going to own a million- dollar car, you

know that this is it's far from

practical. like that is not a practical

choice. And so you're not

>> implicitly by buying a million- dollar

car, you're already making a decision

that this is an impractical purchase.

>> And so I think when you're making an

impractical purchase, there's all sorts

of things that are maybe not practical.

>> Yes.

>> And so in our case for like R2 or even

R3 and R3X, which I think the most

excited for the channel, you're like

Delta.

I am really R2 is very important and I I

I think that R3 is like my cherry on top

like what I'm waiting

>> when you go off-roading, whether it's

low speed up a trail or higher speed on

like a gravel trail, electric is really

enjoyable. The the instant torque is

nice.

>> Um you're never you never find yourself

in the wrong gear on a rock like, "Oh

jeez, I'm rolling backwards." It's just

like instant torque.

>> The danger.

>> Yeah, it's

>> But it's I'm very deep off enthusiast

deep like danger. One of the challenges

with off-roading is does have a barrier

to entry that historically because it

takes like knowledge of like what does a

differential do? What's a center locking

differential? What's a rear

differential? And suddenly you get into

like a quad motor R1. You just tap off

like you just can do it and suddenly you

>> know on that subject one thing people

talk to us a lot about not necessarily

in terms of Rivian although maybe more

with quad but the Hummers um is just the

sheer size of these vehicles and the

sheer acceleration level

>> vehicles. We've been driving the R1S

quad uh the Gen 2 quad around. It's

insane. It's really quick.

>> Is there any 2.6 seconds and laugh about

like we think it's awesome. Is there any

do we have any respons like corporate

responsibility fears about people having

people I actually get asked this

question a lot particularly when the

Hummer came out which I was pretty into

and I still am. Um

>> well I love that they always said are

you afraid that like a little old lady

is going to drive. It's like, well, if

there's a little lady driving a Hummer

EV, that's one thing. But

>> I mean, these cars are really fast and

really big, and it doesn't require any

special, you know, when we were kids,

you had really legit to have a access to

a car that was anywhere near this,

>> right? But electric cars have

democratized speed and such a

>> Oh, I I remember when the um when the

993 Turbo came out and it hit 0 to 60 in

3 seconds and it was like the top of the

chart for 0 to 60 and I was like, "Wow,

I can't move a car and break 4 seconds."

right now. And now I can be with my kids

in the back and like a lawn mower in the

vehicle. I can do two and a half seconds

in a R1T

>> and so yeah. Is that is that a good

idea?

>> It's a 7,000lb vehicle.

>> Yeah.

>> I mean you guys have done a great safety

system. Like it seems so safe to do that

zero that 2 and 12 seconds 0 60

>> but is it

>> it's very safe. There's a whole bunch of

>> Yeah. But is it wise?

>> Is it wise? Uh

>> I think it's important like why does a

car like that exist?

Why do we make a 2 and 1 half second 0

to 60 SUV and truck?

>> Yeah.

>> Um we think it's important to answer

some of your questions which is like you

can still have fun in electric vehicle

>> and it's like you know you see the badge

in the back for the quad is this little

gear guard figure that is being blown

back.

>> Like we're having fun with it. Yeah,

it's we're embracing

>> the silliness of a 2 and 1 half second 0

to 60

>> SUV and

>> it's it's a brand building vehicle. It's

not going to be the highest volume

vehicle,

>> but it really helps people get excited

around maybe they get a try or a dual

motor and of course it opens up the door

for people to say, "Oh, wow. I want to

consider this R2."

>> Right. Right. C can I ask about that?

All right. So there the only visual

differentiations of the quad motor are

the brake calipers

>> and the and the R1S badges says quad

>> in the gear guard with his hair.

>> Sure.

>> Yeah.

>> What is this?

>> Why not more?

>> We're astonished by this. When we were

kids, you get an M3 and it's got rocker

panels and it's got badges. It's got

wheels and it's got a wing and it's got

there's all this stuff because you want

people do you want your neighbors to

know

>> I got the expensive one.

>> I don't. So I love the subtlety but KN75

is special because it looks visually

distinct. Most people who are spending

more over a regular one want to show

>> why not fly fenders. Why not?

>> How come why don't we have some flared

fenders on this thing?

>> I seriously legitimately

>> I think given infinite time resources we

probably would have done maybe different

front and fascia.

>> Oh um

>> this was we like the subtlety of this

one. I I and I think over time you may

see like our next like gen 3

>> quad maybe have something that's a

little bit different than the try but

it's uh it was like a lot of debate

around this like how how aggressive do

we go and we we went with subtle here

>> over time we think its personality

around quad could could continue to

evolve

>> I was telling our producer yesterday

that I love it and therefore it's

probably not the right product plan if I

>> well you see with like Gwagon right

which is a competitor the regular one

looks like the regular one. The 63 has

the big wheels and the the brush guard.

>> Harder and harder to tell at a glance.

>> Well, a lot of them are 63s, but they

really do sell it, right? They really

and and I think that probably appeals to

people and you still see that in a lot

of

>> for our brand. We also have there's a

degree of subtlety to to

>> I mean,

>> you walk around this lot, that SUV is

faster to 100 milesPH than almost

everything on this lawn.

>> Yeah.

>> Which is really wild. And so the fact

that you're starting there, it sort of

says, okay, do we we don't actually need

all these like scoops and all this just

doesn't need it.

>> But that was probably always true,

right? We knew that the M3 didn't in

need a rear wing.

>> The Curado didn't need active active

air, but it had fair,

>> but it had it.

>> I need that extra downfall.

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So, in a bunch of drag tests or drag

races, the Raven is fastest off the

line, but then loses out to some other

cars because of the speed limiter.

>> Yep.

>> I assume you guys have done some

testings without it. Where do you get?

>> Well, you asked the question for on

safety. That's that's it. So, we made

the we made the decision on the non-quad

we limited to 110.

Uh, and then in the quad, we limit it to

130. Really, just because

>> otherwise it would just kill the 1/4

mile time,

>> right?

>> Um, and in fact, the 130 is only enabled

when you go into sport mode. But

>> how fast could this thing go if we let

it run?

>> A lot faster.

>> But the reason we don't on your R1S,

which I assume maybe has some special

features.

>> I've got a lot faster than those. Yeah.

So

>> on a close closed track, but look, what

are you getting to?

>> Uh you could go a lot faster,

>> but I mean these are not cars you can

hack, so nobody will ever unlock. Well,

no, but you know, there's got to be a

benefit to being in the Seattle.

>> But the reason is at 130,

>> you're committing a felony on every road

in the United States.

>> Yeah, but not on the Bonavville Salt

Flats.

>> Sure.

>> But but again, you just said like this,

if you're going to the Bonavville Salt

Flats, you're probably not taking this.

And so,

>> I don't know. I like it. It was like a

corporate decision. Let's air on the

side of safety. And the cars are so

quick. I mean, you're on the throttle

for a second. You could be going 150.

>> Yeah. way faster than you guys.

>> At least 150 we got the news item for

the day.

>> Can I have 40? We don't know yet.

>> All right, I lied. I have one more

question. What is special about your

R1S, your R1T? What What can regular

people not get that you have?

>> What What features are you demoing that

you're not allowed to reveal yet?

>> The Porsche family is famous for having

special one-off models built of cars.

>> Yeah. You're the founder and CEO. What

What do What do you have in your You

>> not particularly different. I I drive

like the R2 of course is

>> Yeah.

>> just because it's a you know it's on

out. Um but the R1 I'm usually a

software release or two ahead of

everything else which is just part of my

my job.

>> Yeah. And other people are too in the

company.

>> Yeah. Like a lot of our team is on early

release and so

>> yeah.

>> Yeah. That's fun. And it's also because

you're on early release you you spot

things you can change. Uh that's one of

the things I really enjoy is because we

do a software release every month. We

can be continually adding features and

it is very dynamic. So I'll get like

emails from customers with an idea and

you know I'll call our head of software.

I'll call him be like hey let's get this

in.

>> Really cool. How legit is that? That is

>> very cool. Like my dad was bugging me

for the longest time on the car wash

feature the way it was activated and

what in the way the mirrors folded. So I

we changed it and in the release notes I

was like thank you dad for the advice

like and I something like please stop

asking

>> on that subject with regards to founders

and and we're going to move on to market

report next quickly and then we'll move

on to questions a lot of people ask

questions they have for you and we want

to we want to talk through it but I do

have one other question which is regard

regarding

>> your um sort of the face that you are

for the business uh versus say Elon

>> Elon is

uh chose to make himself kind of like

the you know Tesla and Elon are

inextricably linked in basically

everybody's minds. Um the result of that

was a cult of personality kind of formed

around him and I think that that

probably had a huge uh benefit for the

success of that brand for a long time

>> and risk now

>> now we're seeing maybe some of the

drawbacks of that. You have never been

kind of as as outgoing in terms of tying

yourself to this brand of Elon. Was that

intentional? Do you regret it? Were you

looking at Elon saying, "Hey, I'm cool

too during this process." Like what?

>> Yeah. Uh

I think

I think like if you start a company,

you're there's always or if you're like

the core part of running a business,

you're going to be linked to it. I think

for for me, we've we've been

reserve more reserved just in how we've

come across as a company.

>> Yeah.

>> I'm more reserved as a person. And I

think we've been intentional uh in

trying to be as inclusive as possible.

And so as a brand, I say this all the

time, we have, you know, a widespread of

demographics. We have Republicans that

buy our cars. We have Democrats that buy

our cars. We want to be appealing to

both. And um have tried really hard to

make sure that the environment is is

like is the broadest possible welcome

map to all customers. And I think Tesla

did that for a while. I think I think

you know I think the brand they built is

still really strong but my personality

is much different than than

>> Yeah. And and that's what it came down

to. You think is that you didn't just

you weren't the guy who was going to be

out there tweeting the president?

>> Yeah. And I think just like my social

presence is much smaller and um

>> and intentionally like you feel that

that's just who you are more.

>> Yeah. It's more it's not it's not as

designed as maybe you're thinking. It's

more of like the resultant of just two

very different personalities. Got it.

Not that one's right or wrong. I think

it's been super productive for Tesla as

you said for creating tons of

>> Was there ever any push from your PR

folks or from your market get out there

from your shareholders do more crazy

stuff?

>> Yeah. I don't know if there's been a

push I think um

>> I mean jokingly people are like you know

say RJ you're not going to go do this

are you?

>> We don't get into what I mean you're on

a podcast we don't for you drugs on the

podcast. No nothing like that.

I mean, it's I think sometimes some of

this stuff gets taken so seriously. Like

I I've owned two Teslas.

>> I think there's a perception that

>> uh one company has to one for one

company to be successful, everyone else

has to fail. And what's so wonderful

about like the auto industry and and for

as a car enthusiast is many companies

can be successful. It's very different

than tech. Yeah. Like if you think of

like big tech, there's like generally

there's like one or two dominant players

in a segment for a market

>> in an auto you can have all these

different flavors, different

personalities. Yeah.

>> Uh and the personalities maybe have some

echoing effects from their leadership or

their founders.

>> And so you our products have a lot of my

personality in them,

>> right?

>> And some of their subtlety and and um

like quiet confidence.

>> Yeah.

>> Right. There's one last question I want

to ask just based on that. Are there any

other automotive CEOs you look at and

you admire what they've done with their

vision for their companies along those

same lines that what you've done with

yours?

>> Yeah, I mean it it's a such a small

world.

>> It is, you know, so we um I have great

friendships with a lot of different CEOs

and um yeah, it's fun to trade notes and

a lot of times you find yourself you'll

send them a text be like, "Hey, I really

like this." You'll get a text like,

"Hey, nice job." you know, so it's sort

of it's it's more um

uh you know, it's more collaborative

behind the scenes, I think, than you'd

think, you know, and especially in the

last few months with all the significant

changes.

>> You know, certainly I've talked to other

CEOs and said, "Hey, like how are you

guys thinking about wire harness supply

or

>> uh you just to think about like how

we're all responding to trade tariffs

and things of that nature."

>> Texting Mary Borrow asking on a group

with Jim and Jim Farland.

>> You mentioned Mate, he's a friend of

mine, good friend of mine. He's uh I

think he's outstanding. He's done some

really interesting things. Great

technology.

>> Uh we both started companies around the

same time. So we've we've known each

other over the years

>> in that world.

>> So cool. Um

>> I'll mention just because it happened

off camera earlier. You did say that the

Ethern M5 is the greatest car ever made.

>> I didn't say greatest car made.

>> All right. All right.

>> I didn't even say the best M car, but

best M5.

>> What is the best M car?

>> Probably the E46. All right. Wow. We'll

accept that.

>> Wow.

Our audience will3

is more like what BMW is about. Straight

six is their core competency engine.

Historically car is perfect 5050 weight

distribution. It's small, lightweight,

tossable, high revving. It's like what

an M car is supposed to be

traditionally. The M5 is just the best.

But the I have a friend E30 conversion

where he's putting a Yeah. E46.

>> That'll make that thing a B.

>> But it's funny. He's like, I should have

just bought a GT3 RS cheaper.

>> Yeah.

>> Um,

>> I would have, but that's but that

anybody can just do that. He built

something cool last.

>> I want to talk market report and

specifically since you're here, we want

to talk EV market report, which is just

typically where we talk about used car

values and you know what used cars are

sold strong recently, sold poorly,

what's what's cheap, what's expensive.

Um, we haven't actually talked in the

market report segment that much about

EVs. We talk in the news segment a lot

about EVs because they're in the news,

but in the market report, we don't cover

it all that often. But it is an

interesting topic because there is some

crazy EV depreciation. Are you aware

already that Rivians, what did we say?

>> We've R1 high mile R1Ts. We've seen

55,000 mi R1Ts are in the 50s now.

>> In the 50s. I mean, this is going to be

a car in the 40s pretty soon. That's a

pretty appealing car on a from a used

perspective.

>> I I won't go back in time a little bit.

In 2022 and 2023, we saw a ton of

interest in the R1T and the R1S for a

long time. I remember that first R1T

sale. Do you remember, Doug? Yeah. Right

after it came out, we were 30 grand.

Nobody

>> We were making We were making big money

while you

>> were we were losing money on the cars at

the time. Like all these people were

buying and selling.

>> Yeah. We were We were making more money

on Rivian than you were. I

>> That's true.

>> Uh but now obviously there's a little

bit depreciation. They seem to

depreciate like normal vehicles to a

large extent. Uh

>> as the CEO of the company, how do you

think about what the used market looks

like? How to maintain that? Ferrari as

an exotic car manufacturer obviously has

to think a lot about how do we treat our

customers? What do they expect? Is that

true as a the co of a new company?

>> Yeah, I mean

>> you might be surprised. We spend a ton

of time talking about depreciation.

We're very we track it very closely.

>> Is there a fear? Is there a goal? Is

there a target?

>> The ribbons are actually relative to

>> they're incredible. It's amazing how

much

shows the level of interest and

excitement in the brand. I think more

than any other individual thing,

depreciation kind of proves what the

actual interest is, right? Cuz you can

put a sticker price wherever you want

to, but we know transaction prices for a

lot of cars are lower. Maserati and then

and then what ends up happening in the

used market is really where they're

priced, right? And I think the fact that

Rivians have held up relatively well

>> is is a pretty good marker of demand.

But so so so you put a lot of thought

into it. You're thinking about this. So

I mean so the obvious things is like

what happens in when we did the gen one

and gen two you think about like what

happens to the gen one vehicles and so

as you referenced like a $55,000

>> 2021 high mileage Gen 1 R1 four-year-old

car

>> it's actually not bad%

of MSRP so it's doing pretty well

>> it's doing well but it is starting to

get I mean two two three more years we

start to see this thing in the 30s

that's pretty cool as a as a

>> I think it's a good thing so so um I

mean before I jump to that because

that's an important point.

>> The other thing we spent a lot of time

thinking about is pricing changes and so

when you move your pricing around a lot

and we've had an experience where we did

move pricing before we right as we were

launching and it had a whole bunch we

didn't go down there. Oh, we remember

tears

to go down that road. But we'll save

that next time. But but we made a, you

know, we made some tactical errors and

how we did it, but just recognizing the

sensitivity to movements in your price

up or down. Um, what it can do to people

who just purchased a car, what it can do

to the, you know, secondary markets or

depreciated value. So, we have a whole

pricing process. We have like, I hate

the word committee. We have a pricing

committee

>> that makes sure that we're not sort of

knee-jerking around with pricing.

>> Yeah. And um

>> Tesla call out there.

>> Well, and then what we do on the pricing

is if you do that really well and you do

maintain a residual, it helps you get to

much better lease rates.

>> Yeah.

>> And so if you look at the Rivian lease

rates, they're they're quite attractive

and a big part of that is that our

residuals are so small.

>> You might be the only EVCO that can say

that. I think it's a lot of EV lease

deals have been based on residuals that

have not been reality.

>> On that topic, I want to talk about your

thoughts on the other market report

topic is the other thoughts on other

EVs. Are you looking at used market?

It's wild how cheap some of these EVs

are.

>> Model S's are sub 10. Early early Model

S's that are 13,

>> but even fairly recent. You can get a

Model 3 Performance now for under 20,

right?

>> 20 for like a high mile early one.

>> These are cars that do 0 to 60 in 3

seconds that are that are only a couple

years old. I mean, it's absolutely

unbelievable the depreciation. Well,

this is I was just going to say I think

one of the exciting things for me as

much as we don't want our vehicles to

depreciate the you know the the passage

of time leads to the vehicles price

coming down in part because the

technology becomes a little older

>> but they're really important for

building the brand to get people

exposure and so

>> you know I I'm I grew up a Porsche

enthusiast. I've never bought a new

Porsche. I've owned multiple Porsches

and like the ability to be exposed to a

brand that you aspire to through a

vehicle that's 10 or 20 years old is

really powerful. And so,

>> you know, with R1 is going to do that

with, you know, five, sixy old cars.

You're going to start to see people be

able to afford it that couldn't before.

And then R2 will do that as well. And

so,

>> yeah, what's really fun for us is you

typically when you look at, let's say,

Porsche or existing brand, a legacy

brand, they don't have any participation

really directly in that used marketplace

because once they sell the car to to

wholesalers, to dealers, it sort of

becomes

>> out of the world,

>> right?

>> And so, in contrast,

>> we get to play in that world for a long

time. We we're active participants in

our used marketplace. Um in the long in

the fullness of time, I hope and

anticipate being able to participate. So

like transacting on these, so buying our

own cars back,

>> creating a really smooth, seamless

experience for first-time Rivian

customers, buying a used Rivian, uh

because so much of these vehicles

depends on software,

>> our ability to keep those vehicles

current uh is really powerful, remove

self-driving and stuff like that. Yeah.

>> Okay, we got to move on to questions

from our audience. We we told

>> I know right

audience that you were going to be on.

They we asked them to ask questions.

They asked a lot of questions. Some of

which are very very interesting directed

at you.

>> Uh and we have a few minutes for them.

Starting with the first question from

our user Buick.

>> Oh Buick Buick RJ.

>> Which by the way only makes EVs most of

mostly for China.

>> Do you think there could be room for a

Rivian? Everybody wants future product

information which he's not going to

talk. Do you think Yeah. Do you think

there could be room for a Rivian with a

removable roof? uh or perhaps maybe even

more doors to direct or maybe even

removable doors to directly compete with

the Wrangler and Bronco. That has been a

shockingly strong segment. Wrangler

Bronco.

>> Yeah. Yeah.

>> Are we thinking about

>> Sounds like my dad? My dad.

He's got some great name.

>> So, we've never shown it. I might as

well just say it here.

>> Wow. Um, when we developed R1,

>> we originally had and in fact like toled

it and there there are some of these

still in in our fleet that had a

removable carbon fiber roof.

>> Really?

>> Yeah.

>> Like removable in what way? You can take

it off.

>> If I mean you can't see it on camera,

but was a Rivian like this. So, the

whole glass roof was replaced with uh a

three-piece carbon fiber.

>> Oh, like a like a target top almost like

>> like it would be removed and like taken

away from the vehicle.

>> Removed and fit nicely into the front

trunk. Wow. Wow.

>> And we decided to not do it because it

was adding a lot of complexity to

production. We had all kinds of

challenges with supply chain.

>> But it but it it was actually a really

neat thing cuz you could drive in an

open top setup. So

>> I wouldn't say never. It's we we

certainly recognize the appeal

especially for an adventure vehicle

being able to take the top off.

>> Um you know in R2 we've already talked

about how the glass goes down. Um, we've

>> we're there are thoughts. They're in the

mind. They're in the mind.

>> We are enthusiasts that recognize the

the coolness of removing glass from the

car.

>> Okay. You're going to set up a like a

concept car tour for us, right? We'll

come to right behind right behind this

display. We got all our

similar subject uh from Hemoglobin.

R.J., Would you ever consider, and I

think this is especially an interesting

one, would you ever consider offer

gasoline range extender versions of

Rivian trucks like Scout plans on doing

with theirs?

>> No.

>> Never. This is not a This is never going

to be a thing. Are

>> do customers ever ask like the obviously

Scout thinks there's a market for it?

>> And you guys are a part of that

development.

>> Yeah.

>> And there's and there is a going to be a

lot of overlap between crossover between

your vehicle and their vehicle. Similar

sort of situation. Do you do customers

ever ask for it?

Not really. Um,

and I I you know, I recognize some

brands are going to do that and we we've

seen that range extended EV uh do really

well in China, but for us it just it's

not something we'd focus on. It's

>> you're not going to do I see it as it's

an intermediate solution. And so it's a

lot of effort to develop capabilities

that are

>> unavoidably throwaway capabilities. And

so if you're an existing manufacturer

that already has a team, maybe you could

see why, but we're so clearly, you know,

focused on a pure EV play.

>> Right. Right. It's a lot. It would be a

lot of work to get into the combustion

engine.

>> It doesn't align with what like how we

think about products and you make a

bunch of different decisions around

vehicle architecture.

>> Sure. Sure. Uh, okay. Next question from

CX9er. Question for R.J., how are you

going to make sure that Rivian stay fun

and exciting? Tesla made a ridiculous

truck that got everyone's attention.

Hyundai has a manual transmission.

Somehow Chinese EVs can jump. One of the

interesting things we talk about a lot

is how

>> in the past cars got were distinguished

heavily based on their power trains.

>> And now with EVs that won't be the case

anymore. And so automakers are going to

kind of have it seems to me it seems to

us that automakers are going to have to

keep doing kind of more unusual stuff to

to get like you see this jumping Chinese

EV. I'm sure

>> yeah the Chinese in general have really

gone.

>> They got some weird doing what kids

would do. cars and it's and they've got

some weird stuff

>> is you I'm sure you're thinking about

like if especially as cars can drive

themselves what can what can we do for

the

>> drivers I'm here that's why I'm here

>> no jumping riv but I mean like the kick

steer feature I talked about

>> that's um

>> you have to use it it's sort of it's

it's crazy it's like really cool the

whole car rotates on its axis and you

can

>> you know you can spin it's all kinds of

things but

>> you know is that something you're going

to use going to a grocery store probably

not so it's it is a feature like that

That's exciting. I think across every

vehicle, we whether it's R2 or R3 or

even thinking about things beyond that,

we actually are very uh structured in

saying like what are the things if you

had to show your friend, hey, check this

out.

>> What are the things you'd immediately

point to? And you know, you talk about

his quirks and features, like what are

some of the things that just like stand

out, leave an impression?

>> And every car will have some collection

of those. Some will carry between

vehicles. Like we have a flashlight in

R1. Yep.

>> Flashlight in R2. R3.

>> Um,

>> and then some will be unique to each

vehicle. R1T has this gear tunnel.

>> Is there is there thought of just like

weird stuff like should we be thinking

about like fish tanks in cars or like

you know what I mean? Like do are you

thinking are you trying to think about

where is this going to go? The

windshield.

>> Speaking of fish tanks, do you see the

the cars in there's some people in China

that are doing wraps?

>> Yes. With the fish

>> with fish in actual fish.

>> Okay. Are we thinking about fish fish

wraps?

That is not in our model. But I couldn't

believe that that was a real thing. I

was like, is it AI or is that real? I

don't know.

>> Is is there thought about like weird

like do you have futurist type people

working on like what weird crap is going

to be out there that we have to be ahead

of?

>> Yeah, it I mean it it a lot of uh a lot

of some of the most interesting wild

ideas run up against what you can do

from a regulatory point of view.

>> Yeah. And so, uh, linked to that is when

you design the car, a lot of thought

goes into what becomes a projectile. So,

in the event of a collision, like if you

have a fish tank, it looks cool until

you get into like a a bad accident and

got like a fish tank in your face.

>> There's just not enough room on that

line to like get in the insurance right

tank not start to like become something

that's flying koi everywhere.

>> Okay. Question from Joe Silver. R.J., If

you could drop a Ribean skateboard

platform under any classic vehicle body

like a restood mod, what would it be and

why? What would you choose?

>> I have the answer to that. But I

wouldn't take the whole platform cuz

it's it's bigger than the vehicle. But

>> uh but okay, pretend it would be

>> I would take a the new dual motor, so

two motor per axle that's in the quad.

It's also in the back of the tri and put

it on a 21 window bus.

>> Nice.

>> That sounds like terrifying. It sounds

perfect because it's like 600 horsepower

in the back of a of a bus.

>> Volkswagen has done something sort of

power in the back.

>> What are your thoughts about this

Volkswagen ID Buzz situation?

>> It's a little different, but

>> it's a different idea than what I'm

talking about.

>> It is different. It is different, but

they've they've they've modernized it a

little bit.

>> It's cool. It It's in the list of

vehicles. If I was going to buy a non-

Rivian, it'd be one in my like list of

things I'd

>> What else on that list?

>> What else is on the list? Uh, I think

the Tyan's like a fun car. So, it's um

it's like a four-door 911 that's

electric. So, it's a lot of things.

>> It drives like that, too.

>> Yeah. And I think it's a car that I

often when people ask me about that car,

I say you have to look at it through the

lens of this is a sports car that has

four doors. It's not trying to be a

>> like an everyday luxury sedan.

>> But I think it's

>> Is there a gas powered car on that list

or diesel powered?

>> Yeah.

>> You seen one?

>> What? A 911?

>> Yeah. So, you see like a the 911 ST

would be

>> one car. Yeah. That's the only only

Every enthusiast

>> Yeah. wants one. 100%.

>> It's like every enthusiast and every car

company CEO either wants one or has one

and will never talk.

>> That's true.

>> Hide the 911s.

>> In the vein of your father to make a

request. I love minivans.

>> Okay. Yeah.

>> R12

or 23 window bus with

>> Yeah. But I want like a modern regular

looking mini. I just want the utmost

practicality. Can we do a

>> 19187

caravan?

>> Yeah. or just an R1V. Can Can we make

that happen? Sliding door on the side.

Lower lower height,

>> too. I mean, clearly, so we're not

>> something to consider.

>> Yeah, small market, but

>> not in the

>> not a lot. Not a lot.

>> Vans are low on the list.

>> Okay, one more question from Joe Silver.

R.J., if you gave Rivian's design team

zero budget constraints for a Halo

vehicle, what would they build? Or maybe

what would you direct them to build to

build like a Halo car at the top of the

range? Yeah. So, we do a lot of

exercises as the design team.

>> Someday we may have to show all this

>> that like when you're designing when

you're going through like R2 where R2 is

today,

>> the team gets like pulled into like like

painful details. So, you're like

designing the inside of a headlight

>> like reflecting surface

>> and so your brain gets so locked into

sketching R2s and every detail on R2.

And so, we need like ways to reset

thinking and so to like get your brain

remixed. And so we actually do a lot of

things that the design team will do like

a two week sprint on an exercise just to

get our brains reset.

And so that has meant we've designed all

kinds of things like what would Rivian

look like if it was a uh a movie

character like in a superhero movie. Um

but one of the exercises which was a

particularly fun one and directly

Chevrolet Corvette

Ferrari F50

Lamborghini Gt 350S

Shelby Gt 350S

Cadillac V16

Acura Rdx

BMW M5

BMW E39

Rivian R1T

Rivian R1S

Rivian R2

Tesla Model 3

Tesla Model Y

Dodge Charger

Porsche Macan

Mercedes-Benz Mercedesbenz Eq

Lotus Elise

Porsche 914

Porsche 356

Porsche 911

Tesla Roadster

Toyota 4Runner

F-150 Raptor

G-Class Gwagon

Jeep Wrangler

BMW M3

BMW E46

Tesla Model Ss

Ford Bronco

Volkswagen Id

Acura CL

Bmw M

About this episode

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