WEBVTT - Rivian CEO RJ Scaringe Talks R2 Model

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>Rivian's new R two is rolling off the line in Normal, Illinois.

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<v Speaker 2>Big milestone for the company. It's a smaller, more affordable

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<v Speaker 2>suv and for many this is the vehicle that will

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<v Speaker 2>define Rivian's path to profitability. The company continues to burn

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<v Speaker 2>through cash. Joining us now from the factory is CEO RJ. Scaringe,

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<v Speaker 2>who has driven quite a few R twos off the

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<v Speaker 2>line already today. It's a big moment, but our j

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<v Speaker 2>we should point out that on Friday the facility was

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<v Speaker 2>hit by a tornado, by a big storm. There was

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<v Speaker 2>damage to certain parts of the factory. What was the

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<v Speaker 2>net result of that? Is everyone okay? And has there

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<v Speaker 2>been any material impact to the start of production plan?

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<v Speaker 1>Yeah, I mean, of course, of course, you can't plan

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<v Speaker 1>for these kinds of things, and we didn't expect a

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<v Speaker 1>tornado to hit Friday night, but you know, the teams

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<v Speaker 1>responded really well. Fortunately everyone was safe. We followed our

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<v Speaker 1>protocols as soon as we knew there are tornadoes in

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<v Speaker 1>the area. But yeah, tornado went through the south end

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<v Speaker 1>of the plant and ripped the roof off the building

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<v Speaker 1>and knocked down some of the some of the plants

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<v Speaker 1>as well, and so the last you know, seventy two

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<v Speaker 1>hours have been around the clock. You're getting all the

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<v Speaker 1>water out of the facility and getting ready to rebuild

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<v Speaker 1>the south end. But you know, it's like the ultimate

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<v Speaker 1>example of resilience of the business where the teams have

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<v Speaker 1>come together and we still had vehicles come off the

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<v Speaker 1>line this morning.

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<v Speaker 2>Is the plan still the same You can get through

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<v Speaker 2>the same kind of ramp strategy that you had the

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<v Speaker 2>same volumes in that initial output.

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<v Speaker 1>Yeah, our ramp up this week and into next week.

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<v Speaker 1>We're not making changes to the plan. We're obviously having

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<v Speaker 1>to make some accommodations for the fact that a big

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<v Speaker 1>it's the logistics area of the plant and so the

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<v Speaker 1>way that Materira was flowing into the plant through the

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<v Speaker 1>dock doors is not to come in in a different way.

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<v Speaker 3>But you know, we're working through it. We're working through it.

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<v Speaker 4>What's interesting is orders demand configuration r Jay. What do

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<v Speaker 4>people want and how willingly are they putting in the orders?

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<v Speaker 1>Yeah, I mean, I'm as you said, I drove a

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<v Speaker 1>bunch of our twos off the line today. I've been

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<v Speaker 1>driving in our two for a while and the car

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<v Speaker 1>is just incredible. It's the combination of the package, the

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<v Speaker 1>driving dynamics, the efficiency of course, the design, and just

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<v Speaker 1>the aesthetic feel. So we're really excited to get folks

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<v Speaker 1>into it. There's a tremendous amount of enthusiasm. We've had

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<v Speaker 1>a few events where we've hosted potential customers to experience it.

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<v Speaker 1>And you know, we were in Denver a couple of

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<v Speaker 1>days ago and there's like a super long line just

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<v Speaker 1>to sit in the car.

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<v Speaker 3>So we'd love to see the enthusiasm.

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<v Speaker 1>And I can't wait to continue to ramp up production

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<v Speaker 1>and start seeing these on the road.

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<v Speaker 4>I mean, I loved Ed's enthusiasm when he came to

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<v Speaker 4>have a look at your in How's AI chip? And

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<v Speaker 4>I'm interested is where therefore that vertical integration comes in.

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<v Speaker 4>You're also including light O. Look there, there's a roadmap

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<v Speaker 4>for these variants. When does that enter production?

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<v Speaker 1>ALJ so our in house silicon, which is an eight

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<v Speaker 1>hundred tops per ship.

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<v Speaker 3>We have two of those chips in the vehicle and

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<v Speaker 3>we couple that with.

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<v Speaker 1>Cameras, radar and a lighter that sits at the top

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<v Speaker 1>of the windshield that comes in at the end of

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<v Speaker 1>this year and so our launch edition still has a

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<v Speaker 1>very highly capable self driving platform, which is essentially a

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<v Speaker 1>further development of what's in our our one vehicle now.

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<v Speaker 1>But across the vehicle, you know, our two just represents

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<v Speaker 1>so many learnings for us as a business, whether it's

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<v Speaker 1>the drive line, the power electronics, just the way it's

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<v Speaker 1>being built in terms of cost and cost efficiency, and

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<v Speaker 1>so there's there's like not a there's not a detail

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<v Speaker 1>in the car that hasn't been thoughtfully evolved or developed

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<v Speaker 1>relative to what we've done in our one.

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<v Speaker 2>Oh Jae, I want to go a bit more specific

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<v Speaker 2>on what carry is talking about. The story with R

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<v Speaker 2>two has changed a little bit. I think you'll probably

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<v Speaker 2>thinking about an autonomous future a bit more than you were.

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<v Speaker 2>But the idea was to get close to that forty

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<v Speaker 2>five thousand dollars mark a vehicle for the masses. You

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<v Speaker 2>start with a premium and more expensive variant, but what

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<v Speaker 2>are you seeing in the demand pockets for getting to

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<v Speaker 2>a lower price point that is where you want to

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<v Speaker 2>take on the established lowems.

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<v Speaker 1>Right, Yeah, Well, the average price of a new car

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<v Speaker 1>in the United States is about fifty thousand dollars, and

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<v Speaker 1>so really important US as we're developing R two is

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<v Speaker 1>recognizing we wanted to be right in that range, and

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<v Speaker 1>so having a variant that starts at forty five and

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<v Speaker 1>then going up to our top spec for the performance

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<v Speaker 1>version with all the kit for the interior is at

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<v Speaker 1>fifty seven.

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<v Speaker 3>It allows us to really nicely straddle that.

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<v Speaker 1>And of course, you know, launching any product, you have

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<v Speaker 1>the decision of what do you launch first? You launch

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<v Speaker 1>the base BAC midspec topspec right, and it's impossible to

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<v Speaker 1>sort of make everyone happy with when you have a

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<v Speaker 1>launch edition. We decided to launch with the premium spec,

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<v Speaker 1>but we'll be introducing like a middle like a midspec vehicle,

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<v Speaker 1>and then the forty five thousand R version will come thereafter.

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<v Speaker 1>But that all rolls out over roughly the next year,

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<v Speaker 1>and you know, there's so much enthusiasm for the product

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<v Speaker 1>that we're very like, we feel really confident with the

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<v Speaker 1>way we've configured the specifications and even the pricing. We

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<v Speaker 1>feel quite strong that we've we've priced it appropriately, especially

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<v Speaker 1>when you look at the capabilities and then the cross

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<v Speaker 1>shop of what other vehicles are in the space.

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<v Speaker 2>I've experienced the R two that does have the ld

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<v Speaker 2>R and the in house silicon, and it's so interesting

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<v Speaker 2>there's going to be a generation of R twos that

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<v Speaker 2>don't have it. I know that you said they're very

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<v Speaker 2>capable with the Nvidia silicon and without lid R, but

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<v Speaker 2>that's a big call to make, right. Is there any

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<v Speaker 2>flexibility to accelerate the timing of where you can start

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<v Speaker 2>production on the R two line in Illinois and bring

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<v Speaker 2>in that gear, because what you're pitching for the autonomous capabilities,

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<v Speaker 2>even the advanced driver assistance capabilities of our two, they

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<v Speaker 2>are predicated on that next gen gear.

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<v Speaker 1>Well, the launch edition still has a very high ceiling,

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<v Speaker 1>and so this will get to and our Gen two

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<v Speaker 1>R one will also do this. Later this year will

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<v Speaker 1>start to roll out point to point level two, so

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<v Speaker 1>I meaning hands off wheel, eyes on road, but you

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<v Speaker 1>type the address and the car completely drives you there.

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<v Speaker 1>And then into next year we'll start to roll out

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<v Speaker 1>level three, so hands off, eyes off for specific domains

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<v Speaker 1>in this case, you know, starting with highways. And that

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<v Speaker 1>will be true for Gen two of R one, It'll

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<v Speaker 1>be true for the launch edition of R two, and

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<v Speaker 1>will of course be true for the variant of the

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<v Speaker 1>vehicle that has the higher compute stack and more capable perception.

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<v Speaker 1>And what that more capable perception is going to allow

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<v Speaker 1>for is a higher ceiling of what the vehicle can

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<v Speaker 1>ultimately achieve, and so it'll achieve higher levels capability. And

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<v Speaker 1>importantly it serves as a really valuable part of our

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<v Speaker 1>data flywheel. And so think of the R two fleet.

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<v Speaker 1>It's a high volume product as being part of training

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<v Speaker 1>are what we call our large driving model, and the

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<v Speaker 1>existence of a light our plus the enhanced inference just

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<v Speaker 1>allows us to do a better job of capturing lots

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<v Speaker 1>and lots of driving miles to train our model.

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<v Speaker 4>Look, other automakers are probably looking at that flywheel. Ah Jay,

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<v Speaker 4>I'm really interested in some of the hints we're getting

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<v Speaker 4>some of the coverage in the markets about discussions to

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<v Speaker 4>license your software, your autonomy stack, your underlying technology to

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<v Speaker 4>other automakers.

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<v Speaker 2>Is that in the works?

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<v Speaker 3>Well, I think in the fullness of time.

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<v Speaker 1>You know, when you look at what we're building as

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<v Speaker 1>a business, there's really two revenue opportunities. One is we

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<v Speaker 1>continue to grow by selling vehicles, So of course R

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<v Speaker 1>two is the embodiment of that, that's what we're driving towards.

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<v Speaker 1>But there's another element of our business, which is leveraging

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<v Speaker 1>the technology we're developing. And the first example that was

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<v Speaker 1>what we did with Volkswagen. We did a five point

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<v Speaker 1>eight billion dollar software licensing deal and that allows us

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<v Speaker 1>to deploy this is not our self driving but our

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<v Speaker 1>compute stack and our software platform, our os across a

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<v Speaker 1>wide range of electric vehicles within the Volkswagen portfolio. And

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<v Speaker 1>so we're excited about the potential to do more deals

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<v Speaker 1>like that with our operating system in the vehicle, with

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<v Speaker 1>our vehicle, and certainly as we think about autonomy, the

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<v Speaker 1>potential that's there for us also license that in the

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<v Speaker 1>long term.

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<v Speaker 4>Ravian CEO RJ scarrange. We'll let you get back to

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<v Speaker 4>those R twos that are rolling off the shop floor.

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<v Speaker 4>We so appreciate your time today from an annoying