E for Electric: Rivian's Huge Error Points to CEO's Loss of Control

[Sgt Beavis]

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[COdogman]

If RJ didn’t know about the price increase plan, he should have and that is a big mistake. If he did it is obviously still a big mistake. Every company makes mistakes. The question is how do you learn from it and make sure it doesn’t happen again? Rivian will be ok. They did the right thing and went back on the pricing but now instead of people being excited about more options everyone is talking about how they tried to screw their preorder holders.

RJ should seriously $hitcan several people on his team who aren’t competent. That’s the bare minimum.

 

[Cavalryscout18]

I’m not a fan of these clickbate YouTube channels that just say ridiculous things every week to garner views.

 

[Joel]

one never knows, it could have been a board move. Then after the price issue and they had a lot cancel. Maybe only then could the change happen.

 

[MoreTrout]

I stopped watching this moron a long time ago. Of all the YT channels out there, he is about the most clueless and misinformed I have seen. And that's saying something. He is useless.

 

[NooterIA]

One has to assume the board was aware of this beforehand, and obviously RJ would have known as well. How they collectively could have come to the agreement that their plan was a good plan is beyond me, and it really speaks volumes about the leadership like it or not. Learning moment, yes, but this is a black eye that'll take a lot longer to heal.

I was OK with the gamble of $80K beforehand, and I still am, there's just a lot more anxiety now than there was a week ago. Somewhat happy I'm not up for delivery till later this year to allow some more visibility time into executive leadership/decisions.

 

[Speedrye]

I suspect there was definitely some bad advice given. Somebody calculated how many cancellations there would be, and how that number was low enough to warrant the price increase moving forward. That was bad enough, but did nobody in leadership have enough common sense to question this? Are they that out of touch with the buyers of their vehicles?

 

[Tim-in-CA]

I suspect there was definitely some bad advice given. Somebody calculated how many cancellations there would be, and how that number was low enough to warrant the price increase moving forward. That was bad enough, but did nobody in leadership have enough common sense to question this? Are they that out of touch with the buyers of their vehicles?

Yep. It doesn’t take an industry insider to know that what Rivian did pricewise was very unwise. The people that championed this price move most really should be terminated. They have damaged the brand and the company. Just look at the stock today! And in the end Rivian completely screwed themselves over because reservation holders would have tolerated price increases slowly over the course of a year.

 

[fotoflux]

As someone that is sometimes involved in plans that may change the stock price of a publicly traded company. I can say with 100% certainty RJ was in the loop beforehand and would have known exactly how the price increase was going to be communicated and rolled out. the executive team is always made aware of any material changes to operations.

 

[crashmtb]

one never knows, it could have been a board move. Then after the price issue and they had a lot cancel. Maybe only then could the change happen.

Worth noting who the chairman of the board is. ?

 

[skyote]

Worth noting who the chairman of the board is. ?

Dude, your signature is the longest, funniest, & most appropriate thing I've seen today.

 

[jtshaw]

one never knows, it could have been a board move. Then after the price issue and they had a lot cancel. Maybe only then could the change happen.

I've never seen a company setup where a board would have that power and I don't think you can blame them. Board members (outside of RJ, who chairs the board in this case) aren't day-to-day Rivian managers. They help the team set goals, ensure fiduciary responsibility, and provide accountability. They generally don't make operating decisions though...

 

[BigSkies]

So I'm not going to watch a clickbaity video. I do have some experience in the tech startup world though.

A price increase like this would always go through the CEO, and would be discussed heavily at the board level. The idea that "someone didn't know" is comical. There might have been different levels of buy-in between the CEO and the board, but it would have been discussed and executed with some level of consensus.

Reading between the lines, I would guess that they decided they needed a price hike, and would go for broke on who it would apply to (everyone). They also went in with a contingency plan of rolling it back at different levels (maybe for just LE holders or for everyone pre Mar-1st) depending on how much customer blowback there was. This let them know where the market stands and gets them the most revenue they could actually get away with.

 

[SASSquatch]

If RJ didn’t know about the price increase plan, he should have and that is a big mistake. If he did it is obviously still a big mistake. Every company makes mistakes. The question is how do you learn from it and make sure it doesn’t happen again? Rivian will be ok. They did the right thing and went back on the pricing but now instead of people being excited about more options everyone is talking about how they tried to screw their preorder holders.

RJ should seriously $hitcan several people on his team who aren’t competent. That’s the bare minimum.

I agree with you that heads needed to roll after the decision to raise prices. Here is what I believe:

1. RJ is a young founder and CEO and is going to make mistakes
2. He likely has senior advisors who have been in the business longer than he has who have his ear and can sway decision making.
3. He was confronted with a very stark reality given the gross margins and was given advise that they HAD to raise prices to appease shareholders and that the result would mean some reservation cancellations but that the support base from RIVIAN enthusiasts would prevent significant attrition in reservations.
4. Someone probably convinced him that TESLA raises prices all the time and the Teslarati don't flinch.
5. My sense is his gut told him "NO" but his team convinced him otherwise.
6. He now has less confidence in his team and he needs to get the right team around him to support him.

 

[Trekkie]

This was my last video I'll watch of E for Electric, his hyperbole/conflict desire is too high. Too much clickbait like headlines. He gets to talk to Sandy a lot which is what had me watching some of his stuff, but he's out of my rotation for a while.

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