Rivian removes Max Pack battery + Quad-Motor option from R1T orders

[sotek2345]

The fact that they are just getting going is the reason they cannot become competitive. These vehicles are software-based and to succeed requires unit sales in the hundreds of thousands, or affiliation with a larger organization that provides that resource (such as Lamborghini being a division of Volkswagen Audi Group, same for Bentley, etc.). It takes billions in infrastructure and development costs - and no new manufacturer, starting from scratch, can get scaled sufficiently to have a competitive product to market. It is not possible, full stop. I love what the folks at Lucid, for example have done. But their Achilles heel, and it is fatal, is software development resources. Every review raves about the car and then says - don't buy it, the software is buggy, long lags, freezes, and generally sucks, plus charging doesn't work. Even Tesla is struggling there, and they have multiples of the resources, many multiples of these little guys. They are succeeding due to being way ahead of the pack as first mover, but there is no chance that any emerging competitor can catch them. Perhaps some of the legacy manufacturers will be competitive - see KIA, Mercedes, Nissan, maybe Ford and GM. But for the small players, there just are not enough units to spread the development costs for mapping, self-driving, user interface, etc. This is my bailiwick - finance and cost structures (I'm a finance professor at Johns Hopkins as my retirement gig). I've spent a lot of time inside Tesla's financials - the only thing that got them here is an amazing product (engineering for range, performance, style, Supercharging) and huge positive gross sales margins, coupled with a very high stock price and the concomitant ability to issue many billions of dollars of new capital to finance R&D and new plants - those elements (most critically the billions in capital access) do not exist for the Fiskers, Lucids, Rivians, etc., and none of them can survive. Not one. No chance.

I largely agree with you, but I can see 3 things that could disrupt this idea and let some of the new start ups survive.

1) The Pettiness of Billionaires. Bezos has plenty of resources to keep Rivian going if he wanted to do it to spite Elon and Telsa. Not saying that will happen, but it could

2) common platform development. If the smaller players got together and worked on a common platform they could share the cost burden and potentially make it through. As you said, software is the big issue, but much of the software can be vehicle agnostic.

3) Chinese government. Lots of the new start ups, that seems to be doing the best, are coming out of China. The Chinese government could easily keep them afloat and expanding as part of their strategy against the western powers

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