Ford Ditches Electric SUV: Is it Time to Address the Elephant in the Room?

[ndmiller]

OMG every single thread is a comment on the industry or competitor that's doing X and should Rivian do Y. This is the second or third Ford thread in the last week or so that Ford made a decision thread that should be moved from General to competitors. Seems like I'm putting someone on ignore almost daily these days. I ignore competitor forum for a reason and these threads keep coming into General. Reported to be moved.

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[Riviot]

Food for thought.

 

[BearMan123]

This is officially stupid.

 

[SASSquatch]

Imo, every 2 car household should have 1 EV and 1 hybrid/phev at this time. If we had to replace our second car, which is ICE, it would be hybrid/plugin. When it's time to actually replace our car in about 5 years, things will be different and we decide at the time.

For me, ICE cars became unsafe when EVs weigh 30% more. It's a no-brainer. SUVs were the nukes till recently, now EVs are the nukes.

This is a great observation. We are in this situation where we have a hybrid that averages 45MPG and we use it exclusively as our road trip vehicle and the EV(s) become commuting and around-town vehicles that make up 90% of our driving.

This calculus is why I think hybrid sales have been and continue to be strong.

Hybrids are also very familiar to the average consumer, require no lifestyle change, but provide some of the advantages of electrification.

 

[SASSquatch]

This is officially stupid.

Yet you are here, anyway.

 

[SASSquatch]

OMG every single thread is a comment on the industry or competitor that's doing X and should Rivian do Y. This is the second or third Ford thread in the last week or so that Ford made a decision thread that should be moved from General to competitors. Seems like I'm putting someone on ignore almost daily these days. I ignore competitor forum for a reason and these threads keep coming into General. Reported to be moved.

This is NOT a Ford thread. This is a thread discussing how Rivian can adapt to changing market forces at a critical juncture as they attempt to mass produce an affordable EV to survive as a company.

How about you actually read the thread instead of coming in here just to post a dismissive response that actually uses the term "Ford" twice as many times as I did in my original post.

 

[ohseedee]

This is officially stupid.

You may disagree with the original thesis that Rivian should get into the ICE business, but you can’t disagree that a SASSqatch thread is where the fun is!!!

 

[Jayhawkeye]

Why do people get so butthurt when the market begins to shy away from EV?

It’s a valid concern for those of us who don’t want to lose out on a 100k investment.

 

[SASSquatch]

You may disagree with the original thesis that Rivian should get into the ICE business, but you can’t disagree that a SASSqatch thread is where the fun is!!!

I don't want Rivian in the ICE business - but if they want to sell a version of their enduro motors and battery tech to VW (or anyone else) who wants to develop a hybrid/PHEV to generate capital and ensure they successfully produce and scale R2/R3 would you have a problem with that?

 

[SASSquatch]

Why do people get so butthurt when the market begins to shy away from EV?

It’s a valid concern for those of us who don’t want to lose out on a 100k investment.

Ageed. Rivian unfortunately doesn't have a good track record on delivering on many of their promises. It pains me to say that, but it has been true too many times.

I am deeply skeptical as an investor given their track record that Rivian has the ability to execute on reducing cost significantly, scaling production, generating a profit, and not burning through all of their cash before they can see the fruits of their labor.

I am of the opinion that they need to explore strategic partnerships - whatever those look like - with other OEMs and leverage what they are really good at. I think they have some significant innovation in battery and electric motor tech that could be profitable licensed to another OEM - just like they are licensing their software to another OEM.

It isn't outrageous to think that in the current environment, Rivian should be exploring all options.

 

[emoore]

Ageed. Rivian unfortunately doesn't have a good track record on delivering on many of their promises. It pains me to say that, but it has been true too many times.

I am deeply skeptical as an investor given their track record that Rivian has the ability to execute on reducing cost significantly, scaling production, generating a profit, and not burning through all of their cash before they can see the fruits of their labor.

I am of the opinion that they need to explore strategic partnerships - whatever those look like - with other OEMs and leverage what they are really good at. I think they have some significant innovation in battery and electric motor tech that could be profitable licensed to another OEM - just like they are licensing their software to another OEM.

It isn't outrageous to think that in the current environment, Rivian should be exploring all options.

The moment Rivian gets involved with ICE I’m out and probably a bunch of others. The only advantage Rivian has is making EVs. If this county wants to be stupid and ban EVs then Rivian is done. Doesn’t matter who they partner with.

 

[SASSquatch]

The moment Rivian gets involved with ICE I’m out and probably a bunch of others. The only advantage Rivian has is making EVs. If this county wants to be stupid and ban EVs then Rivian is done. Doesn’t matter who they partner with.

It is your right to feel that way. This is obviously a hypothetical, but I would be torn if Rivian chose that path.

It would be digestible if it were under a different badge.

As much as I would like to waive a wand and turn every new vehicle sold into an EV, the reality is that simply isn't going to happen. Consumers are deeply skeptical of EVs for a number of valid reasons and these barriers have to be addressed before we get to mass adoption:

• EV's have on average higher insurance costs relative to ICE counterparts and longer and more expensive repair times.
• EV's on average cost more
• Depreciation is high because of evolutions in core EV technologies.
• EV charging infrastructure not controlled by TESLA is neither ubiquitous, reliable, nor easy to use like ICE refueling stations.

Hybrids/PHEV's have significantly higher fuel economy then their purely ICE counterparts. While that doesn't make as large a dent into fossil fuel emissions as having a pure EV does (at least in terms of operating the vehicle - battery manufacturing uses significant fossil fuel energy) it absolutely reduces emissions.

It lowers the cost of ownership for consumers since they spend less time filling up. Hybrids cost less than EVs, require lower insurance premiums, and provide some advantages of electrification without the anxiety and lifestyle change that owning an EV requires.

The reality is that EVs are going to be competing with hybrids for many years to come because of the time it will take to significantly change the barriers above which consumers are extremely sensitive to.

The bar for Rivian and every other OEM is extremely high. Not only do they have to develop a great product people actually want to buy, but they have to make it affordable AND generate profit, and they have to do it against a landscape of intense competition and overcome headwinds like the lack of ubiquitous charging, higher insurance costs and repair times, etc.

They way you survive is to adapt. Adapting sometimes means joining forces and developing strategic partnerships.

 

[emoore]

It is your right to feel that way. This is obviously a hypothetical, but I would be torn if Rivian chose that path.

It would be digestible if it were under a different badge.

As much as I would like to waive a wand and turn every new vehicle sold into an EV, the reality is that simply isn't going to happen. Consumers are deeply skeptical of EVs for a number of valid reasons and these barriers have to be addressed before we get to mass adoption:

• EV's have on average higher insurance costs relative to ICE counterparts and longer and more expensive repair times.
• EV's on average cost more
• Depreciation is high because of evolutions in core EV technologies.
• EV charging infrastructure not controlled by TESLA is neither ubiquitous, reliable, nor easy to use like ICE refueling stations.

Hybrids/PHEV's have significantly higher fuel economy then their purely ICE counterparts. While that doesn't make as large a dent into fossil fuel emissions as having a pure EV does (at least in terms of operating the vehicle - battery manufacturing uses significant fossil fuel energy) it absolutely reduces emissions.

It lowers the cost of ownership for consumers since they spend less time filling up. Hybrids cost less than EVs, require lower insurance premiums, and provide some advantages of electrification without the anxiety and lifestyle change that owning an EV requires.

The reality is that EVs are going to be competing with hybrids for many years to come because of the time it will take to significantly change the barriers above which consumers are extremely sensitive to.

The bar for Rivian and every other OEM is extremely high. Not only do they have to develop a great product people actually want to buy, but they have to make it affordable AND generate profit, and they have to do it against a landscape of intense competition and overcome headwinds like the lack of ubiquitous charging, higher insurance costs and repair times, etc.

They way you survive is to adapt. Adapting sometimes means joining forces and developing strategic partnerships.

Don’t agree. Rivian will go out of business if they try to get into the hybrid game.

 

[SASSquatch]

Ford and Chevy have to contend with a legacy customer base that are going to be among the last to convert to BEV. Combine that with some only marginally compelling BEV product offerings and transitioning to BEV via hybrid makes some sense for them. And let's be realistic here, Rivian is never going to sell hundreds of thousands of $100k vehicles per year. They won't see significant growth of sales volume until R2 and R3 hit the streets. Personally, I see the hybrid detour by Ford and Chevy as a blessing for Rivian giving them more time to bring the products people actually want to market at a price they can more easily afford. Rivian just needs to stay the course.

I 100% agree with this sentiment. My issue is, can Rivian scale R2 and R3 at they numbers they need to actually be profitable before they run out of cash?

They have 4-6 quarters left at current burn rates. Those burn rates will not stay where they are once Rivian scales production of R2. R1 sales are not providing the cash flow that Rivian needs to get R2/R3 into production at scale especially since they are still significantly profit negative on every R1 they sell.

 

[ttphhi]

Startup costs. Amortization of that and R&D over shorter spans. Rivan 'loses' money on each vehicle because those costs are baked in. If you look at the BOM for each vehicle, that's a different story.

Yes, my thoughts exactly. I've seen this "Rivian loses $30k on every R1 they sell" a lot. I always thought that included their legacy startup costs which should eventually go away. Not to mention upcoming new factory builds, etc. Who came up with that $30k deficit anyway. Not trying to be a smart ass, I've just seen that figure used so am curious who/where it came from.

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