Rivian Layoff 10% Staff and Lowers Production Forecast for 2024

[RivianRunner]

The Roadster was being sold in 2008. That's a fact that can't be ignored. So five years after the company was founded, they sold their first car. Rivian, on the other hand, it's more than twice that amount of time.

As far as positive gross margins, what did you expect? That only comes with scale. No start-up car manufacturer will be able to scale from the beginning. Rivian just needs to stay afloat long enough to reach that point.

That's not true, Tesla has had positive automotive gross margins, even on the Roadster hand built in the early days on a modified Lotus Elise chassis. Over 4 years they built less than 2500 of them. It was a proof of concept vehicle, hand made in low numbers, which is why I didn't count it. By the time Rivian built their first EV, the modern lithium-ion EV had already been commercialized by Tesla and others. Even the hand-built Roadster was built with positive gross margins, that's how tight of a ship Elon ran. He knows how to run a business.

This is exactly the point I see misrepresented again and again here. Specifically is that Tesla did not build cars profitably from the early days. On a gross margin basis, they did. The only reason so many are misguided on this point is because TSLAQ types constantly parroted that they lost money on every car they built. That was never true, with perhaps a couple of quarterly exceptions. Every year they had positive automotive gross margins, the more cars they built, the less money the company lost.

Like many here, you are confusing net margins with gross margins.

I do agree with your first point, Tesla moves about twice as fast as Rivian.

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[Supratachophobia]

The Roadster was being sold in 2008. That's a fact that can't be ignored. So five years after the company was founded, they sold their first car. Rivian, on the other hand, it's more than twice that amount of time.

As far as positive gross margins, what did you expect? That only comes with scale. No start-up car manufacturer will be able to scale from the beginning. Rivian just needs to stay afloat long enough to reach that point.

But also remember that they only made a couple thousand Roadsters.

Production wise, Rivian is on par with their 3 models that Tesla was with just Model S.

Profitability wise, I have no idea how or if the two can be compared with regards to years in business.

 

[RivianRunner]

I agreed with the first part of your comment, but not with the above quoted paragraph. It's not economically foolish to buy a new gas car at all.

'

To be clear, I didn't say it's economically foolish to buy a gas car now, I said "We are quickly getting to the point where it would be economically foolish to buy a new gas car unless you are a busy travelling salesman who is constantly driving the freeways, thousands of miles per week."

Because economics and convenience will always matter and EVs just keep getting cheaper to make due to declining prices of key components like the battery and optimization of the manufacture that is moving away from methods pioneered for gas vehicles over the decades. EVs are easier to build with far less labor. The cost to build a gas car continues to rise.

So, yes, we are quickly approaching the point for most motorists where it would be foolish to buy a new gas car, based both upon the purchase price and the lower cost of operation and maintenance of electric powertrains.

I would argue that buying a new EV today is more foolish than buying a new ICE vehicle. Why? Simple--it's an emerging technology and the EV you buy today is going to be old news in a few short years. 800V architecture, transition to NACS, better batteries, longer ranges, faster charging, etc....these are all things expected to happen and we already know some of those things are happening already. So your shiny new EV isn't going to be all that desirable and therefore less valuable, which means one thing--high depreciation. Yes, all cars depreciate, but if EVs get better rapidly, it's going to mean a big hit in value quickly.

Again, I didn't say "today" it was foolish to buy a gas car, the EV charging infrastructure is still growing rapidly but is not ready for prime time in many areas of the U.S. and the world. That said, we are approaching the turning point at which most people will not want a gas car. And that will impact resale values. EV's have been very expensive until recently, and that explains most of the high depreciation we have seen. But the tables are about to be turned. WIth new EVs becoming increasingly less expensive, that's going to have a big impact on the average priced gas vehicle that you paid $48K for. Because as the transition to EVs progresses, not many people are going to want to pay you $35K for your used gas car when they can buy a nice new EV for less without worrying about oil changes, alternator belts, brake discs and pads, catalytic converters and all other things that can wrong with a used ICE car.

I'm not sure why you think ICE sales are so poor. From what I've seen, sales were up by double digits in 2023 despite any increased demand due to Covid.

Have you forgotten already? The COVID supply chain breakdown caused a crashing of ICE sales, the recent uptick in sales is recovering from that. I said ICE sales have been declining for years, once smoothed over for COVID disruptions. How can you claim strong ICE sales when they are far below their peak global sales of 97 million in 2017. ICE sales have been declining since 3 years before COVID hit, while EV sales are on a strong trajectory upwards, growing every year right through the COVID disruptions. 2024 will be no exception, global ICE sales will be down again, EV sales will be up. The mainstream media likes to create false narratives, I base my viewpoints on cold hard facts.

There's no doubt that EVs have a certain popularity and are growing, but the rate is in fact pretty slow. Yes, the government continues to incentivize EVs because the demand isn't truly there. Think about that.....it's not just at the federal level, but also many states. Here in NJ, nobody pays sales tax on an EV, new or used. That's a huge incentive, yet only about 8% of new vehicles sold in NJ are EVs.

As much as people in NJ or NY like to think they are at the center of the universe, that is especially untrue when it comes to autos. NJ is not a leading indicator of anything. The reason the blazing speed of EV growth has slowed, is because car sales in general are impacted by higher interest rates. But at least EV sales are still growing, not shrinking like ICE sales are. EVs are still the growth engine of the automotive market, regardless of what the media or car dealerships tell you.

I really don't believe the media is creating a false narrative on EVs. The information is out there for anyone to find.

Ha! I've given you the information, you just prefer to believe the media wouldn't mislead you. Americans tend to live in a little American bubble, I try to avoid that tendency. Do you know what the largest car market in the world is?

It's China, by far. The Chinese buy more new cars than any country on earth, even if you consider N. America a "country" and group all Euro nations into the European Union. And 35% of all new car sales in China are electric cars. Norway has over 80% of new car sales electric. These are shocking statistics for most Americans to comprehend. And it's not because those countries are backwards when it comes to autos, they are leading the way to the future.

None of this will prevent uninformed Americans from parroting what they heard on the nightly news. You cannot stop an idea whose time has come, especially when the driving force is economics. That's what's driving the transition to clean electric cars. They are cheaper and cost less of the owner's time. And time is money.

 

[White Shadow]

'

To be clear, I didn't say it's economically foolish to buy a gas car now, I said "We are quickly getting to the point where it would be economically foolish to buy a new gas car unless you are a busy travelling salesman who is constantly driving the freeways, thousands of miles per week."

Because economics and convenience will always matter and EVs just keep getting cheaper to make due to declining prices of key components like the battery and optimization of the manufacture that is moving away from methods pioneered for gas vehicles over the decades. EVs are easier to build with far less labor. The cost to build a gas car continues to rise.

So, yes, we are quickly approaching the point for most motorists where it would be foolish to buy a new gas car, based both upon the purchase price and the lower cost of operation and maintenance of electric powertrains.

I still disgree. I'm not a traveling salesman, but rather just a regular guy who likes to road trip a few times a year. Not thousands of miles per week, but definitely well into the hundreds, on average. The average U.S. driver probably drives less than 300 miles per week. I drive quite a bit more than that, on average. Right now, there's no comparable EV to the vehicle that I drive other than an R1S, which is A LOT more expensive than my current vehicle.

Again, I didn't say "today" it was foolish to buy a gas car, the EV charging infrastructure is still growing rapidly but is not ready for prime time in many areas of the U.S. and the world. That said, we are approaching the turning point at which most people will not want a gas car. And that will impact resale values. EV's have been very expensive until recently, and that explains most of the high depreciation we have seen. But the tables are about to be turned. WIth new EVs becoming increasingly less expensive, that's going to have a big impact on the average priced gas vehicle that you paid $48K for. Because as the transition to EVs progresses, not many people are going to want to pay you $35K for your used gas car when they can buy a nice new EV for less without worrying about oil changes, alternator belts, brake discs and pads, catalytic converters and all other things that can wrong with a used ICE car.

I almost have to wonder if you even live in the U.S.

Seriously, there's a huge anti-EV sentiment in this country. Gas powered vehicles are going to be around for a long, long time. Resale values are never going to be great, but that's always been the case and will continue to be the case. And like I mentioned already, resale values for EVs are going to be really sketchy if they continue to improve. Nobody is going to want today's EVs when tomorrow's EVs are going to be so much better as technology improves.

Have you forgotten already? The COVID supply chain breakdown caused a crashing of ICE sales, the recent uptick in sales is recovering from that. I said ICE sales have been declining for years, once smoothed over for COVID disruptions. How can you claim strong ICE sales when they are far below their peak global sales of 97 million in 2017. ICE sales have been declining since 3 years before COVID hit, while EV sales are on a strong trajectory upwards, growing every year right through the COVID disruptions. 2024 will be no exception, global ICE sales will be down again, EV sales will be up. The mainstream media likes to create false narratives, I base my viewpoints on cold hard facts.

I'm not talking globally, I'm talking North America. I really don't care about the rest of the world or what's going on with the car market elsewhere because it has little to no impact here. Covid had a short term negative impact for sure, but the Big Three have made $21 billion in profits in just the first 6 months of 2023. They have made more than $250,000,000,000 in profits in the last 10 years. There's no issue with the way things are going right now for them and it's not clear where they are headed with EV technology. Time will tell.

As much as people in NJ or NY like to think they are at the center of the universe, that is especially untrue when it comes to autos. NJ is not a leading indicator of anything. The reason the blazing speed of EV growth has slowed, is because car sales in general are impacted by higher interest rates. But at least EV sales are still growing, not shrinking like ICE sales are. EVs are still the growth engine of the automotive market, regardless of what the media or car dealerships tell you.

All I said about NJ is that buying an EV here means you don't pay sales tax. I'm not sure where the rest of your rant came from. Fun fact: the northeast states are the most populated per square mile than any other region in the U.S. So I'd say in some senses, we are the center of the universe.

Ha! I've given you the information, you just prefer to believe the media wouldn't mislead you. Americans tend to live in a little American bubble, I try to avoid that tendency. Do you know what the largest car market in the world is?

It's China, by far. The Chinese buy more new cars than any country on earth, even if you consider N. America a "country" and group all Euro nations into the European Union. And 35% of all new car sales in China are electric cars. Norway has over 80% of new car sales electric. These are shocking statistics for most Americans to comprehend. And it's not because those countries are backwards when it comes to autos, they are leading the way to the future.

None of this will prevent uninformed Americans from parroting what they heard on the nightly news. You cannot stop an idea whose time has come, especially when the driving force is economics. That's what's driving the transition to clean electric cars. They are cheaper and cost less of the owner's time. And time is money.

Couldn't care less about China. Of course they are the largest car market. China and India are the largest populations on the planet by far. Nothing else you said is news to me. I travel to Europe for work at least once a year. I see what's happening and I also understand why. If I had to pay $2/liter for gas, I'd be looking for alternatives too. But the fact remains that we have low gas prices here in the U.S. and that in itself is going to drive people's purchasing decisions. EVs need to get better before we'll see mass adoption here. Better infrastructure, quicker charging, longer ranges. Lower purchase prices will help too, but unlike you, I realize that the improving technology will prevent prices from falling much, if at all. The new battery technology, for example, will cost more in the short term, not less.

 

[Count Orlok]

100 of these layoffs are in Normal...

Rivian laid off about 100 Illinois workers

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