WEBVTT - Rivian CEO RJ Scaringe Talks Auto Tariffs

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

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<v Speaker 2>We welcome our global radio and TV audiences. Now. Evmaker

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<v Speaker 2>Rivian recently announcing it will be spinning out a new

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<v Speaker 2>company called Also, with the aim to develop evs for

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<v Speaker 2>short trips one hundred and five million dollar funding from

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<v Speaker 2>Rivian and VC firm Eclipse for More. I'm very pleased

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<v Speaker 2>to say we're welcoming Eclipse partner Jettin Bell and Rivian

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<v Speaker 2>CEO RJ Scarrange. Great to have you both here, and

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<v Speaker 2>RJ I start with you the spin out of Also Now,

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<v Speaker 2>why is it better now to let it thrive in

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<v Speaker 2>a solo manner?

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<v Speaker 3>Yeah, well, well thanks for having us on. Yeah, you know,

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<v Speaker 3>we think about overall transportation space and what needs to happen.

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<v Speaker 3>Of course, there's electrification of vehicles and the infrastructure that

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<v Speaker 3>we know of today, and that's what Rivian's been focused on.

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<v Speaker 3>Of course, first the United States and you know with

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<v Speaker 3>our R two program soon in Europe. But there's a

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<v Speaker 3>lot of trips and a lot of miles that are

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<v Speaker 3>much shorter distance and actually work better with something that's

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<v Speaker 3>a much smaller form factor. And so we kicked off

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<v Speaker 3>a skunkworks team a few years ago to look at

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<v Speaker 3>how we could take our core technology stack can apply

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<v Speaker 3>it in a very low cost, much smaller form factor.

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<v Speaker 3>And as that played out, we realized that the idea

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<v Speaker 3>was really had a lot of had a lot of legs.

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<v Speaker 4>It was a.

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<v Speaker 3>Powerful idea, and we decided that this idea was big

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<v Speaker 3>enough to deserve being its own business, and so we

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<v Speaker 3>took the decision to spin it out. Eclipse led the

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<v Speaker 3>financing of that with one hundred and five million dollars investment,

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<v Speaker 3>as you said, and we're really excited about what's the

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<v Speaker 3>comt We haven't shown any of the products yet, but

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<v Speaker 3>they're absolutely incredible.

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<v Speaker 2>Let's therefore ask you, Jane, how is this relationship going

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<v Speaker 2>to evolve? What's the sort of closeness you're going to

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<v Speaker 2>be doing because r J is going to be on

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<v Speaker 2>the board.

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<v Speaker 5>Yes, I think it's exciting because I spent many years

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<v Speaker 5>at Rivian working closely with RJ, and now in this

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<v Speaker 5>new role at Eclipse, you know, really excited to invest

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<v Speaker 5>in this opportunity and really disrupt the micromobility space. Yeah,

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<v Speaker 5>I'm really excited to partner again with RJ and the

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<v Speaker 5>Rivin team as well as the Also team. To, you know,

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<v Speaker 5>bring this vision to life.

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<v Speaker 2>Jten, I ask you the consumer issues here though we're

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<v Speaker 2>a little bit worried, to say the least about the

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<v Speaker 2>economy here in the US. Do you think that the

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<v Speaker 2>consumer is going to be there to back this more

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<v Speaker 2>than one hundred million dollars that you're putting behind this

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<v Speaker 2>offering that starts to get into our hands in twenty

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<v Speaker 2>twenty six.

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<v Speaker 5>Yeah.

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<v Speaker 4>Absolutely.

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<v Speaker 5>I think if you look at the transportation ecosystem around

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<v Speaker 5>the world, it's under so much of stress when it

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<v Speaker 5>comes to infrastructure limitations, when it comes to congestion, comes

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<v Speaker 5>to pollution, and micromobility is a very important piece of

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<v Speaker 5>that puzzle. You know, more cars, more buses, more trains

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<v Speaker 5>is not going to be the answer. You need something smaller,

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<v Speaker 5>something more flexible to complement those other modalities, and we

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<v Speaker 5>believe that micromobility is a perfect solution to that. It's

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<v Speaker 5>a large market already, it's growing very rapidly around the world.

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<v Speaker 5>But if you look at the solutions, you know they're

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<v Speaker 5>very weig technically, very poor user experience. They lack reliability,

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<v Speaker 5>and this is where the opportunity is. And I think

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<v Speaker 5>the consumer is waiting for something more compelling to.

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<v Speaker 4>Hit the market.

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<v Speaker 2>Ah, Jay, it's a global opportunity on micro mobility, and

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<v Speaker 2>you just talked about how it's a global opportunity for

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<v Speaker 2>you right now with Rivian and they are two roll out.

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<v Speaker 2>This is a difficult time to be a global business.

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<v Speaker 2>How are you preparing yourself to access the European market

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<v Speaker 2>when we're worrying about tariffs and you've always set aside

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<v Speaker 2>hundreds of millions of dollars in potential policy.

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<v Speaker 3>Implod Yeah, I mean it's you know, it's a very

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<v Speaker 3>complex environment. You know, as Rivian, we're spending a lot

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<v Speaker 3>of time interpreting and understanding what the teriff implications are

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<v Speaker 3>for us, of course here in the United States, but

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<v Speaker 3>I think importantly recognizing that, you know, in particular Europe

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<v Speaker 3>may respond and so how the ultimately the teriff structure

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<v Speaker 3>sets out and lays out is going to have a

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<v Speaker 3>big impact on some of the decisions to make over

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<v Speaker 3>the next year.

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<v Speaker 4>We're staying very very close to it. But it's, as

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<v Speaker 4>you've called out.

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<v Speaker 3>It's a very dynamic situation and I think some of

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<v Speaker 3>the uncertainty is what makes it the most challenging to navigate.

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<v Speaker 2>Oh, Ja, are you in close discussions with the administration itself,

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<v Speaker 2>have you been getting a glean and what they're thinking

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<v Speaker 2>of for the future.

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<v Speaker 3>Well, I think, you know, one of the things to

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<v Speaker 3>that's important just if we take a big step back

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<v Speaker 3>from all the noise of what's happening. You know it's

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<v Speaker 3>going to happen tomorrow with some of the tariffs that

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<v Speaker 3>have been talked about and will be rolled out. I

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<v Speaker 3>think big step back is there's a clear directive to

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<v Speaker 3>drive technology and manufacturing into the United States.

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<v Speaker 4>And for Yvian, we're a US company.

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<v Speaker 3>We have just under seventeen thousand employees here here in

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<v Speaker 3>the US. We have a plant in Chicago or just

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<v Speaker 3>south of Chicago and Normal, Illinois, and we're building another

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<v Speaker 3>plant in Georgia. So we're growing rapid here in the

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<v Speaker 3>United State. It's one hundred percent of our vehicles that

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<v Speaker 3>they are produced here and all of our technologies here.

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<v Speaker 3>So in terms of the administration's objectives, we're very aligned

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<v Speaker 3>with what's being asked and what I think the overall policy.

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<v Speaker 4>Framework is trying to drive towards.

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<v Speaker 3>But you know, in terms of how that translates to

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<v Speaker 3>our expansion in Europe and elsewhere, you know, we do

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<v Speaker 3>have to recognize that it's a very dynamic environment. Our

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<v Speaker 3>production footprint may be different than we'll be originally planning.

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<v Speaker 4>But I think all of us, you know.

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<v Speaker 3>Across all the different auto manufacturers are waiting to see

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<v Speaker 3>how things look once it does settles.

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<v Speaker 2>That uncertainty, Jaten, I'm sure is affecting you as a

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<v Speaker 2>team of operators investors. How are your other founders coping

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<v Speaker 2>with this moment?

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<v Speaker 5>Yeah, I think uncertainty is the key word here. I

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<v Speaker 5>feel that what is in our control is to focus

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<v Speaker 5>on two things. Making sure that founders building in the

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<v Speaker 5>physical industries have the maximum control on the stack, you know,

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<v Speaker 5>on what they design, what they engineer. If you have

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<v Speaker 5>control over it, then you're able to make decisions to

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<v Speaker 5>optimize around different environments. And the second thing is to

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<v Speaker 5>build that resilience and flexibility in the supply chain so

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<v Speaker 5>that it is able to navigate again short term, medium term,

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<v Speaker 5>and long term changes in the policy environment. So I

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<v Speaker 5>think the key word there for our founders is control

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<v Speaker 5>the controllables. There are things are going to change, things

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<v Speaker 5>are going to change back. I think what is most

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<v Speaker 5>important is to build a resilient strategy and a supply

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<v Speaker 5>chain network within the company that can navigate all these

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<v Speaker 5>different environments.

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<v Speaker 2>A Jay a quick thirty second one for you. Do

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<v Speaker 2>you think you've benefited from people moving away from Tesla

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<v Speaker 2>for political reasons?

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<v Speaker 3>Well, you know, one of the things that I think

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<v Speaker 3>is often missed is we think about electrification. Is today

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<v Speaker 3>only about eight percent new vehicle sales are electric here

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<v Speaker 3>in the United States, And so when we think about

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<v Speaker 3>competition and growing our market share, the biggest opportunity is

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<v Speaker 3>bringing people into our new technology vehicles and introducing people

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<v Speaker 3>into what it feels like to be in a connected, smart,

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<v Speaker 3>of course electric vehicle. And so we really believe there

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<v Speaker 3>needs to be a lot of choice in order for

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<v Speaker 3>us to go from eight percent to fifty percent to

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<v Speaker 3>eventually one hundred percent, we need lots of successful companies.

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<v Speaker 3>We mean Tesla be successful, we continue to be very successful.

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<v Speaker 3>We need Review to be successful, We need the existing

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<v Speaker 3>legacy manufacturers to be successful. And so with our our

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<v Speaker 3>two program, it's a much lower price vehicle. It's really cool,

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<v Speaker 3>it's an incredible product. But what that'll do is we'll

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<v Speaker 3>give customers another choice. And so we think the presence

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<v Speaker 3>of another choice is going to be important from a

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<v Speaker 3>brand and product attributes point of view.

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<v Speaker 2>Thank you both so much for your clarity of thought

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<v Speaker 2>today when there is not much clarity in the economy.

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<v Speaker 2>Jtenbo of Eclipse, r J. Scarrange of Rivian. Great to

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<v Speaker 2>have you both on the show. Thank you.