Rivian (RIVN) clashes with Bosch in new legal battle over EV motors
electrek.coRivian have always struggled to bring down the cost of manufacturing their EVs. This is one of the biggest issues they have when you are making an EV battery & motor are 2 of the most important components of the car. In Rivians case they both are sourced and not done in-house. They got carried away making a luxurious car, custom screen setup (rather then leveraging Carplay or Android Auto) & good looking interior. If you want to be in a profitable in first place they should done total inverse, focus on making a great battery & motor like Tesla did and try to source out other things. This is one of the reasons why BYD and Chinese EV companies are destroying all their competition, they do majority of things in-house.
I’m. It sure why no one is producing a commodity “skateboard” platform for other companies to build their vehicles on. When Tesla showed off this design prior to the Model X (iirc), the idea of a company that could optimize batteries and motors to sell a blank canvas chassis seemed obvious.
That’s part of the idea behind VAG’s MEB platform and GM’s Ultium and the platforms based on it. Ford is using MEB and Honda is using Ultium platforms for the moment.
I think the issue with unibody cars is eventually you’re constrained on how much a base platform can be changed without the OEMs’ commitment to modifying the layout. The Honda Prologue and the Blazer EV have the same silhouette.
> an EV battery & motor are 2 of the most important components of the car.
No. In free market not exist predefined constant priorities. Free market is dynamic system, which constantly change.
In 1960s and before, people buy any affordable machine, but in some niches preferred machines with good dynamics and (or!) with good fuel economy, so yes, good engine and transmission was important, and invested huge resources in them.
In 1980s most machines become very similar, and market demand for beautiful design and comfort, with good enough engine.
European geography is specific, it have big market of powerful 3rd party manufacturers of engines, new manufacturer just not have chances, but it's design market is not filled (nobody could name VAG designs bad, but they lack spice).
Also important thing, modern automobile is not simple thing, to fill all areas (engine, design, comfort), manufacturer need very large team. So to save design costs it is good to avoid some areas, for example to focus on comfort and interior.
So for Rivian is wise to TRY save costs and focus priorities on design/comfort and outsource EV battery & motor.
BTW not all people know, BMW initially was not just focused on dynamics, but sacrificed comfort to save weight, and they was small manufacturer with moderate sales, even once considered to save costs on avoid US market.
I cannot prove, but looks that BMW sales grown magnitudes, after them made pivot, to dynamic-luxurious direction.
Similar to BMW history was with Porsche, their sales grown with Cayenne, which is hated by many fans.
And also important thing - Tesla with Musk have ambitions to be big manufacturer, but not all other companies have such ambitions.
If Bosch couldn't supply the motors required in the contact, I don't see why Rivian has to commit to not making motors themselves.
Seems like the logical thing to do. If Kroger says they'll sell me 100,000 apples and only delivered 23k, I might buy an orchard
Some damning bits if true:
This coupled with BMW's recent pushback against EU ICE phaseout seems to paint a picture of legacy manufacturers unwilling to invest in what is the obvious path forward. It is hard to imagine that in 20, 30 years ICE vehicles will be the dominant mode of transportation for most consumers.> “Bosch made a calculated gamble to overpromise to multiple start-up electric vehicle companies on the theory that at least some of them would soon fail,” the lawsuit read. > Rivian engineers said one of the lines was “in shambles” during a visit to Germany and claimed Bosch was not using “industry standard technology.”Whether Chinese EVs ever make their way to US markets or not, the Chinese shift in consumer behavior and infrastructure there will eventually ripple out to South Korea and Japan and the US and EU will lose that fight with a mindset of denial.
The legacy manufacturers are having a competition to see who can become the next Nokia.
The infotainment system, charging network and charging experience of a Tesla are still far ahead of the competition but I can’t tell why. There is literally a playbook to follow and they are all failing at it.
My non-expert guesses:
- Investing capital for new manufacturing lines, retraining employees, hiring new employees, etc. means reduced profits and reduced short term returns for shareholders. The top level execs probably feel like their heads would be on the chopping block if investor returns were to be reduced in the short term for accelerating long term growth.
- A lot of entrenched mid-level and senior executives are simply protecting their turf. Similar to how Nadella completely turned around the mindset at Microsoft once Ballmer was ousted, I'd guess there are a lot of executives with fat paychecks that don't want to see their little empires diminished.
- Holding taxpayers hostage for government subsidies (to be fair, many electric startups did get the benefit). BMWs "threat" about reliance on the Chinese supply chain feels like a kind of strawman to get more subsidies.
Or general mass market is not interested in BEVs specifically, but in a cheap vehicle which can get them from point A to point B. And BEVs at the moment are anything but cheap + add there negative adventures with charging infrastructure if you can't charge at home (50% of people in EU can't) and owning a BEV is suddenly more of a niche thing for rich people than mass market opportunity.
> And BEVs at the moment are anything but cheap
Fascinating to see the comments on EV threads where they are claimed to be expensive, but also that the second hand values are really low. Surely buying a second hand one solves the absolute “expensive” bit?
Even then I’d question the “more expensive than ICE” claims for new models. In the UK the average cost of a new vehicle is £40k: https://www.autoexpress.co.uk/opinion/363624/average-new-car...
A model 3 is £40k
I am not rich. You can count me in the 50% of people who can charge at home, which saves me £100/month in fuel.
New VW Golf floats around 30k EUR, which is still 10k EUR cheaper than Tesla Model 3 and you still have 10k for fuel - that's with your difference is 8 years of driving.
However 50% of people in EU does not have home charging (i.e. living in apartments) therefore they won't see your savings but they will see the wasted time on public chargers.
> New VW Golf floats around 30k EUR, which is still 10k EUR cheaper than Tesla Model 3 and you still have 10k for fuel - that's with your difference is 8 years of driving.
OK? I chose an average to avoid cherry picking, so I don’t see the value of you cherry picking a cheaper car, it’s just going to be a race to the bottom.
> However 50% of people in EU does not have home charging (i.e. living in apartments) therefore they won't see your savings but they will see the wasted time on public chargers.
It’s very situation dependent. If people can charge at work, while shopping or during natural stops on long journeys and so on. For some it might take longer until infrastructure catches up, but we are digging up roads to put fibre everywhere and I refuse to believe we can’t give every space in a block of flats what essentially amounts to a 3-pin plug (or 2 in the EU).
I had to charge publicly on Friday during a long journey - I’d estimate it took around 30 seconds total extra* time and most of that was the credit card clearing. The car charged as we ate and had more than enough when we’d finished. Still faster than fuelling an ICE since we would have had to do an additional stop.
*It wasn’t even really extra since my wife was inside ordering anyway.
> Me: Or general mass market is not interested in BEVs specifically, but in a cheap vehicle which can get them from point A to point B.
> You: so I don’t see the value of you cherry picking a cheaper car, it’s just going to be a race to the bottom
That's how mass market works. People will always want cheap stuff. Not expensive. Not average. Cheap. Pretending that Model 3 is cheap compared to cheap ICE is delusional.
The whole problem with BEV infrastructure is that it currently makes no economical sense. Otherwise responsible people would be taking care for maintenance and expansion without governmental handouts.
The average person wants the average. That’s what the average is. There will be people wanting cheap, and people wanting expensive but it all averages out to… the average.
I didn’t pretend the Model 3 was cheap compared to cheap ICE. I compared the price of a Model 3 to the average car price, and it was average.
That's a trap of average. When you have a guy buying Taycan for 100k EUR and guy buying Golf for 30k EUR then average car price is 65k EUR. Guy in Taycan does not care about average car and guy buying Golf can't afford this average priced car.
Well if you’re arguing that an average isn’t suitable and a median is more representative, I have good news for you - the article was actually conflating average and median:
> It’s just been revealed to me by Auto Trader that its “median new car RRP” figure for April 2024 was £41,738, rising to £42,340 in May – proving that already-high showroom prices continue to rise.
This means the model 3 is below the median new car price in the UK.
> Investing capital for new manufacturing lines, retraining employees, hiring new employees, etc.
Which is really silly because these new lines are relatively cheap to setup. EVs are easier to manufacturer than ICE vehicles with fewer parts and inspection points needed.
That is why so many small time EV manufactures were capable of spawning out of nowhere.
They're producing what people want to buy. Used EV prices are in freefall. I'm not saying that's a good thing it's just the way it is.
> in freefall
Can you quantify this? Most times when people say things like this they are just repeating headlines of articles. The articles themselves will loosely be based on some truth, but are mostly just EV hit pieces. It would be good to see similar ICE models compared %age wise. “Freefall” sounds dramatic, but if it’s an extra 5% depreciation from the expected 50% over 3 years I think it’s a bit of an exaggeration, especially if fuel savings would fill the gap.
I'd argue that any numbers supporting this are likely significantly skewed by Tesla's recent and dramatic price cuts significantly pulling down the used car prices for EVs as a whole.
> This coupled with BMW's recent pushback against EU ICE phaseout seems to paint a picture of legacy manufacturers unwilling to invest in what is the obvious path forward.
It is not really obvious path when people in Europe are not buying BEVs unless there is some serious subsidy on it.
I dunno; to me, it seems as obvious as the sun-setting of steam powered locomotion. It's only a matter of time.
And as we've seen, it's clear that the future of mobility is going to be electric. I find it hard to believe that if we look 50 years out, the majority will still be driving gasoline and diesel powered vehicles. So then the question is how and when do we get there?
> ...people in Europe are not buying BEVs
I can completely understand the reasons why. Infrastructure, the way residential areas are set up are not compatible with charging, price, inconvenience, etc. But those are problems that governments need to help solve if we already know the end result is that mobility will be primarily electric at some point in the future.
> if we look 50 years out, the majority will still be driving gasoline and diesel powered vehicles...when do we get there?
We already there, but to see this we need to turn off 4-wheel filter, and consider 2-wheel or even 1-wheels, and will see many people already use electric bikes, scooters, other electric.
So electricity already eat huge market share, and for other cases market shrink-ed and become obvious, electric cars are not good enough for now.
In US market is different, for example EU have very strong train infrastructure, so 1-2-wheel transport have very good fit.
> But those are problems that governments need to help solve
I don't think that it has a solution. Governments are trying to solve parking for decades and still no solution in sight. If you don't have where to park, you don't have where to charge.
> I don't think that it has a solution
Sure it does. China has the formula.
> If you don't have where to park, you don't have where to charge.
Incentivize broader buildout of charging infrastructure where people are already parking their existing cars. Fund R&D into new charging technology that can reduce charge times. Any number of ways to solve the problem.
If one starts from a mindset "this can't be solved", then chalk up the L.
> Sure it does. China has the formula.
Build a new city? That's not going to work.
Rivian also got in a dispute with Amazon when the latter wasn’t ordering enough delivery vans; as I understand it they tried to sell to others but Amazon had an exclusivity clause
Seems like some self inflicted wounds in an industry that can’t afford a slip
Thankfully the exclusivity clause was finally dropped Nov of last year. Amazon has invested a lot of money into Rivian and if they want to recoup that investment it’s in their best interest not to needlessly hinder them.
Still hoping the R2 launch gets them into the mainstream and profitable.
My biggest surprise with the non-Chinese EVs is that the range hasn’t been increasing. Rivian announced models r2 and r3 seem that are set to come in 2026 and 2027 seem to still be around 300 miles of range. Most other EVs are similar.
At the same time Chinese EVs have ranges of of 500 and 600 miles.
I don’t think I can purchase an EV as a primary vehicle until they catch up.
Rivian has some options in those ranges, but it gets really expensive. In all actuality 300 miles seems the sweet spot. Long enough to get you most places on a single charge at home except for the few long distance trips each year.
And even for those long distance trips 300 is a lot of time driving. It's 3-4 hours of driving before you charge. Split it up some and you stop every hour or two and use the bathroom and you don't even notice you're charging.
300 is the sweet spot if it's not winter and you don't have a heat pump because of the stupid decision to use the least efficient means of generating heat
Do you know what this is due to?
To save costs and weight on battery, sure.
I don't know Chinese use cases, but in continental Europe many machines don't run full 500km every day, even many private made less then 100km per day, so they don't need 500km range. Not for all 200km enough, many need about 220km..300km for commute (two commutes per day, so could charge battery at parking).
So, with halved battery size, you will got cheaper EV and more space for passengers and luggage.
Large range is a must for business (semi)-cargo machines and for taxi.
The Rivian delivery vehicles are super cool and futuristic.
Rivian is making some of the best looking EVs on the market.
> “Instead, Bosch had apparently employed teenage interns to stand by the line holding flashlights for quality control,”
I’m not surprised. A lot of companies in Germany hire students and pay like 1.000€/month for this kind of work instead of creating automated processes. When you tell them that they need to hire engineers for the automation, they complain how expensive to hire them and instead they can just hire bunch of students by paying less to let them do the work manually.
Yup, can second this. Working Students (which is not the same as hiring Interns) was one of the interesting things I’ve gotten to experience as an American working for the parent of a German multinational company that is a well known name brand in Germany.
I can see the culture shock here. Some German states have what amount to technical high schools. If these are Working Students from a mechanical/engineering type school it’s probably simply “different but not wrong.” For the working students they get to put Bosch on their resume and get paid ok for what would probably just count as course credits in the US.
My experience with working for my specific German company (a wildly thin skinned brand so I’ll leave them unnamed so I don’t get fired) is we generally over promise and under deliver at a high price. We seem to sell to large firms that then do the same based on what the local teams tell me. Brand is so powerful that bad deals just get renegotiated, and new contracts can be drawn up to replace the old ones. Even when they’re unhappy with us or we are unhappy with our own suppliers, we all renew each year so long as it’s a German business dealing with a German business. Breaking a contract without remuneration, even if you’re in the right, is seemingly a cultural business sin and that’s when words get sharp and the “take care of me and I’ll take care of you” yearly renewals go away.
Our contracts are wildly complicated and our legal team for Germany inserts poison pills that would hurt ourselves if we needed to shut down an unprofitable line of business. I’m not a lawyer, much less a German lawyer, so I don’t know if this is normal. One of the companies in my portfolio of products has a clauses that would cost the company 3x what the revenue of the product is in penalties. I don’t know why this is there but perhaps it’s part of this seeming social contract between firms.