NORMAL, Ill. — By definition, the time of the world’s richest man is pretty valuable. But early last fall, Jeff Bezos sought out a 36-year-old entrepreneur named R.J. Scaringe and spent the better part of a day in Plymouth, Michigan, at the company he founded, Rivian.
Bezos got a preview of Rivian’s electric pickup truck and sport utility vehicle and liked what he saw. Not long after his visit, Amazon led a $700 million investment in Rivian. Two months later, in April, Ford Motor invested $500 million. All told, Rivian has raised $1.7 billion without selling a single truck or SUV.
If you have not heard of Rivian before, that was intentional. Until recently, it was in stealth mode, operating out of unmarked buildings and making few public announcements. But no longer. By the end of 2020, Rivian intends to begin producing premium electric vehicles, with a greater range than anything on the road today.
Rivian is promising to do for trucks what Tesla did for luxury cars.
That’s where the similarities between the two electric automobile makers end. Even as Tesla and its brash chief executive, Elon Musk, made headlines by setting and falling short of some audacious goals, Scaringe and Rivian have spent a decade fine-tuning their designs.
Walking around a former Mitsubishi plant in Normal, Illinois, Scaringe points to where stamping presses will churn out car parts like fenders and doors. But he is hoping to do more than sell cars. Scaringe wants to dispel myths he thinks still surround electric vehicles.
“We have a number of untruths — a truck can’t be electric, an electric car can’t go off road, it can’t get dirty, it can’t tow and truck buyers don’t want something that’s environmentally friendly,” he said. “These things are fundamentally wrong. Electrification and technology can create a truck that’s incredibly capable and fun to drive.”
In addition to developing advanced battery systems, Rivian has also designed a skateboard-like chassis that it plans to sell to other carmakers. For Ford, investing in Rivian is a way to leapfrog the competition and get new ideas from a startup as it and other automakers race to prepare for an electrified future.
Amazon has been mum about its interest in the company, but Rivian’s vehicles could help the retail giant reduce its carbon footprint as it builds its own distribution network.
The automobile business has fearsome barriers to entry, and aspiring players have to ante up billions of dollars just to be dealt into a game where profit margins tend to be slim.Scaringe is likely to need billions more to get as far as Tesla, which itself struggled to expand production in 2017 and 2018. But the demand for electric vehicles is there — Tesla built more than 250,000 cars in 2018.
Scaringe founded Mainstream Motors, the business that would later become Rivian, in 2009 after completing a doctorate in mechanical engineering at MIT.
His timing was odd to say the least — the financial crisis had made investors skittish, and the bankruptcies of General Motors and Chrysler did not bode well for an automotive startup.Family and friends provided the initial funding, and Scaringe and his father both took out second mortgages to raise money. Rivian takes its name from Florida’s Indian River, close to where Scaringe grew up in Melbourne, Florida.
Early backing from Saudi and Japanese investors provided the runway for Rivian to develop its electric vehicle designs.
Scaringe, an outdoorsy type who enjoys mountain biking, wants his cars to be able to go off road. Rivian trucks and SUVs can operate in 3 feet of standing water. A ballistic liner protects the battery pack so drivers can take the vehicle into rugged terrain without worrying that rocks and other objects could penetrate the undercarriage.
Rivian’s R1S SUV bears a resemblance to a Range Rover, while the flatbed in its R1T pickup is shorter than the bestselling Ford F-150. “Rivian’s products are not really meant to be work trucks,” said Stephanie Brinley, principal automotive analyst with IHS. “They aim to be lifestyle products, capable but meant for recreational use.”
The R1S will directly challenge Tesla’s SUV, the Model X, and although Musk has said he will introduce a pickup, Tesla has yet to unveil one.
The R1S and the R1T will start at around $70,000 and cost more than $90,000 for fully loaded models that can travel up to 400 miles on a full charge. Rivian has received tens of thousands of reservations from buyers who have made deposits of $1,000 each.
“Targeting the premium pickup and SUV market in the U.S. was smart,” said Sam Abuelsamid, principal auto analyst at Navigant Research. “Those are the kind of vehicles Americans want to buy, as opposed to a compact car or midsized sedan.” Profit margins are higher, too, especially for luxury models.
Asked about Rivian’s rivalry with Tesla, Scaringe would not disparage the competition. He credits Tesla for changing the perception of electric cars as “boring and slow, or glorified golf carts.”
While Tesla has failed to reach its own lofty production targets in recent years, Scaringe is only promising about 20,000 to 40,000 vehicles in 2021, the first full year of production.
— (The New York Times)