It’s a challenge for any automotive startup to produce its first new car.
Irvine-based Rivian is trying to launch three at once — an electric pickup, an electric sport utility vehicle and an electric Amazon delivery van.
Related: Why Southern California is a new EV mecca
Getting off the ground “is a big deal for an EV startup,” AutoForecast Solutions Vice President Sam Fiorani told Bloomberg News in March. “But Rivian takes on the added complication of having three models come out in the same year.”
Fiorani noted the U.S. has had just one successful auto manufacturing startup since World War II: Tesla.
Despite production delays, some experts are calling Rivian “the Tesla of trucks,” in part because of the huge amount of financial support and technical advice it’s getting from the likes of Amazon, Ford, T. Rowe Price, Fidelity and Cox Automotive.
With the closing of its latest $2.5 billion round of private funding on July 23, Rivian announced it has raised $10.5 billion since 2019. Bloomberg estimated the company’s value at nearly $28 billion earlier this year.
Rivian brands its EVs as “adventure products,” designed for outdoor enthusiasts who crave a vehicle that drives well both on and off the road. Air compressors are standard, and for a little extra, customers can get a camp stove with the pickup that slides out of a hidden storage compartment called the “gear tunnel.”
Production of its R1T pickup truck was postponed from late 2020 to June, then to July and now is planned for September.
The starting price for the launch edition is $73,000, not counting the discounts buyers get from federal and state tax credits. Production for the seven-seat SUV, the R1S, is planned to start a month or two after the truck, with a starting price of $75,500 before tax rebates. The company says both vehicles have a range of about 300 miles fully charged and go from zero to 60 mph in 3 seconds.
Here are questions and answers about Rivian based on news reports, company posts and past interviews with Rivian founder and CEO RJ Scaringe.
Q: How long has Rivian been around?
A: RJ Scaringe, 38, founded the company in his home state of Florida in 2009, not long after completing his Ph.D. in mechanical engineering at the Massachusetts Institute of Technology. Originally named Avera Motors, Scaringe rebranded his firm as Rivian Automotive in 2011. The name pays homage, in part, to the Indian River Lagoon near Scaringe’s hometown of Melbourne, Fla., he wrote.
Rivian spent the next seven years “in stealth mode” designing its new vehicles until their unveiling at the Los Angeles Auto Show in 2018.
Q: Who is RJ Scaringe?
A: The Florida native first dreamed of starting his own car company when he was in high school, Forbes reported.
He studied for his doctorate at MIT’s Sloan Automotive Lab. While there, Forbes reported, he grew disillusioned with the idea of building another gas-powered car.
During a 2020 interview with the Lean Enterprise Institute, Scaringe said civilization’s addiction to fossil fuels has reached at “an inflection point.”
“The fossil fuels we use today were built up over the course of approximately 300 million years. We’ve used about half of that in 100 years. So, it’s not a debate as to whether we have to switch off our dependence on fossil fuels,” he said.
“The other wrinkle in this is the impacts of burning fossil fuels. The longer we wait to make a transition, the greater the damage to the planet and air quality. Essentially, what we’re doing is taking carbon that was buried in the earth and moving it into the atmosphere. … We see a huge urgency to solve that, and solving that is not an easy problem.”
At Rivian, Scaringe said, “we’re building something that is meaningful. We’re making something that matters for our kids’ kids’ kids.”
Q: How fast is Rivian growing?
A: The company went from 600 employees at the end of 2018 to more than 7,000, “and is growing every week,” a company spokeswoman said. More than 1,400 of its employees are based in Southern California.
Q: Where are Rivian vehicles being built?
A: The company paid $16 million in 2017 for a 3.3-million-square-foot former Mitsubishi plant in Normal, Ill., about 38 miles east of Peoria.
The Rivian plant currently has more than 2,200 employees and is expected to have 3,000 workers by early 2022, a company spokeswoman said.
The Chicago Tribune reported the company also has 1,000 robots to help build vehicles. Scaringe has posted several tweets showing robots painting vehicles and dipping chassis into a chemical bath.
Q: How many vehicles does Rivian plan to build each year?
A: Rivian expects to deliver 20,000 units its first year and 40,000 its second, according to Forbes. The company won’t say how many vehicles have been pre-ordered.
Q: Rivian has been around for 12 years, but has yet to sell a single vehicle. What has it been doing all those years?
A: To build an auto company from scratch, Scaringe told the Lean Enterprise Institute, “there are a number of items you need to have at the same time or in parallel, all of which are hard.”
You need billions of dollars, thousands of engineers, about 250 suppliers, a manufacturing plant and a team, he said.
“I had none of those,” he said. “No team, no money, no plants, no suppliers, no facilities.”
The challenge was convincing people to give him startup capital when he had nothing to show he could build EVs, he said. It took two years to develop an initial product plan. He then set out to show backers he had a product that was both technically feasible and for which there is a market.
“Today, it’s easy to see there’s a market (for EVs),” Scaringe said. “But eight, nine years ago, for an electric pickup truck, (it) took some convincing.”
Q: What’s holding up production?
A: In a letter to customers last month, Scaringe blamed delays on the “cascading impacts of the pandemic.”
“Everything from facility construction to equipment installation, to vehicle component supply (especially semiconductors), has been impacted by the pandemic,” he wrote. “Beyond these unforeseen challenges, launching three new vehicles while setting up a multi-vehicle manufacturing plant is a complex orchestra of coordinated and interlinked activities where small issues can translate into ramp delays.”
Scaringe said Rivian’s two production lines have completed hundreds of vehicles for testing purposes but is holding off on sales to ensure “the quality and robustness of our launch products.”
In an interview last November with Bloomberg’s Ed Ludlow, Scaringe said he expects supply constraints to hamper production through 2023.
“The challenge of launching a production system,” he told Ludlow, “is managing complexity.”
Rivian profile
- Chief Executive Officer: RJ Scaringe, 38, of Laguna Beach
- Headquarters: Irvine
- Date founded: 2009
- Employees: More than 7,000, more than 1,400 in Southern California
- Factory location: Normal, Ill.
- Product: Electric pickups, SUVs and Amazon delivery vans
