Interesting Video on Rivian & VW

[White Shadow]

This doesn't look great for Rivian. I didn't know that VW will be able to use Rivian's software if Rivian goes under. Makes me wonder just how vested VW is in Rivian's success, especially considering the fact they are expecting to launch competitive vehicles in just a few years.



Desperate Rivian Seeks Bailout From Volkswagen

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[godfodder0901]

This doesn't look great for Rivian. I didn't know that VW will be able to use Rivian's software if Rivian goes under. Makes me wonder just how vested VW is in Rivian's success, especially considering the fact they are expecting to launch competitive vehicles in just a few years.



Desperate Rivian Seeks Bailout From Volkswagen

I mean, they paid $5.8b for the privilege... Not sure why they wouldn't get access to the JV software.

 

[White Shadow]

I mean, they paid $5.8b for the privilege... Not sure why they wouldn't get access to the JV software.

Yes, for sure. But if Rivian goes under, it essentially becomes VW's software. Not like it's a licensing deal or anything....the software and architecture will be VWs. So if Rivian ceases to exist, then Scout will take over with Rivian's software running it. As an investor, I'm not sure how I feel about the Scout brand being such a competitve vehicle, even with VW and Rivian working together. Seems like a bit of a conflict and I can only see the advantage for VW if the cash infusion isn't enough to sustain Rivian.

 

[M3_R2]

Or we could bend over and let Chinese vehicles invade the market. I see nothing but positives with this JV regardless of the eventual outcome. At least someone's trying.

 

[captainjp]

Yes, for sure. But if Rivian goes under, it essentially becomes VW's software. Not like it's a licensing deal or anything....the software and architecture will be VWs. So if Rivian ceases to exist, then Scout will take over with Rivian's software running it. As an investor, I'm not sure how I feel about the Scout brand being such a competitve vehicle, even with VW and Rivian working together. Seems like a bit of a conflict and I can only see the advantage for VW if the cash infusion isn't enough to sustain Rivian.

Does it even matter after they go under? What use is the SW to a bankrupt company?

 

[White Shadow]

Does it even matter after they go under? What use is the SW to a bankrupt company?

Exactly my point----this is probably what VW was thinking when they decided to invest in Rivian. It would somehow be more advantageous to VW if Rivian does eventually go under.

 

[Donald Stanfield]

JFC another doom post.

 

[Donald Stanfield]

Exactly my point----this is probably what VW was thinking when they decided to invest in Rivian. It would somehow be more advantageous to VW if Rivian does eventually go under.

If this was true why did they buy Rivian stock? This makes no sense.

 

[ThirteenElectrics]

If this was true why did they buy Rivian stock? This makes no sense.

For partial control of Rivian, to make sure the right IP goes into the joint venture. Or potentially for control of future R&D goodies. Or because Rivian is weak; Rivian needed cash, there is no reason VW shouldn’t ask for and receive stock in return. It’s kind of a freebie.

I agree that Rivian is in a weak position and VW took advantage. Now Rivian is defocused. Parts sharing is overrated, only a few manufacturers make the parts everyone is going to use anyway. And VW will always get a better deal on a shared part than Rivian, so Rivian is at a competitive disadvantage relative to VW in the market.

Now Rivian has enabled quick time to market for a direct competitor which has a good chance of kicking their ass, or at minimum blunting their growth. Everything will end up costing more if sales are 50% of what they could have been….

 

[PeterSK]

Oh please. At this point Rivian is a more recognized brand than Scout - only boomers still remember it. And Scout even after ramp up in a few years is a rounding error for VW.

VW is not doing this JV to let Rivian die in favor of Scout - they really need help and that includes help running and continuing to evolve the software, which would be harder if Rivian goes under. VW have learned the lesson that they're not good at software, and it's going to kill their whole company, starting with China, if they don't get it right. That's why they're doing a JV, not just buying or licensing.

 

[White Shadow]

If this was true why did they buy Rivian stock? This makes no sense.

Most of the obvious reasons are in the very next post under yours, so I won't bother answering except to say this: Stocks can quickly and easily be purchased and sold. We've seen other large Rivian stakeholders do exactly that. Either way, I'm not saying that this was a devious attempt by VW, I'm simply saying that Rivian's failure may be beneficial to VW, that's all.

 

[White Shadow]

Oh please. At this point Rivian is a more recognized brand than Scout - only boomers still remember it. And Scout even after ramp up in a few years is a rounding error for VW.

VW is not doing this JV to let Rivian die in favor of Scout - they really need help and that includes help running and continuing to evolve the software, which would be harder if Rivian goes under. VW have learned the lesson that they're not good at software, and it's going to kill their whole company, starting with China, if they don't get it right. That's why they're doing a JV, not just buying or licensing.

It's true that Scout has been out of the game too long to have good brand recognition, but Rivian has terrible brand recognition too. Most people have absolutely no idea what a Rivian is when they see one.

 

[Revo]

Maybe Rivian will produce these vehicle's for VW?
What do you all think?
Any news on who is producing them?
TY all.

 

[Donald Stanfield]

For partial control of Rivian, to make sure the right IP goes into the joint venture. Or potentially for control of future R&D goodies. Or because Rivian is weak; Rivian needed cash, there is no reason VW shouldn’t ask for and receive stock in return. It’s kind of a freebie.

I agree that Rivian is in a weak position and VW took advantage. Now Rivian is defocused. Parts sharing is overrated, only a few manufacturers make the parts everyone is going to use anyway. And VW will always get a better deal on a shared part than Rivian, so Rivian is at a competitive disadvantage relative to VW in the market.

Now Rivian has enabled quick time to market for a direct competitor which has a good chance of kicking their ass, or at minimum blunting their growth. Everything will end up costing more if sales are 50% of what they could have been….

Do you understand how stocks work? RJ has controlling interest. That means no matter what else happens RJ has final say. VW doesn’t control anything with the stock they bought.

Your shared part thing doesn’t make sense either. That’s not how volume or supplier discounts work. VW would get the SAME price Rivian does, that’s the whole point of the price sharing.

Most of the obvious reasons are in the very next post under yours, so I won't bother answering except to say this: Stocks can quickly and easily be purchased and sold. We've seen other large Rivian stakeholders do exactly that. Either way, I'm not saying that this was a devious attempt by VW, I'm simply saying that Rivian's failure may be beneficial to VW, that's all.

Stocks can be easily sold? That’s your explanation here? That take is ignorant on how the stock market works. If VW was doing as you said they wouldn’t have bought stock but would have just given Rivian money.

I really question your purpose on this forum. You have stated several times that you have no intention of buying a Rivian, yet you still mill around here sewing discord. What’s with that? I think you need to step up your game a little bit if your intent is to throw a wrench in the works here because anyone who’s completed Freshman year of business school could see how what your saying doesn’t make any sense in the most basic understanding of business.

 

[mkg3]

It's true that Scout has been out of the game too long to have good brand recognition, but Rivian has terrible brand recognition too. Most people have absolutely no idea what a Rivian is when they see one.

Maybe in NJ. On the west cost, Rivian is everywhere. People know what Rivian is.

On your original point, the JV and direct investment into Rivian assures them first right of refusal to acquire the rest of the company, if they so chooses to.

The auto industry is filled with brands being bought and sold to each other. Not just small names but large ones too. Just go back couple of decades and see the story of Chrysler.

After the government bail out (too big to fail...), Chrysler did okay for a while but then sold itself to Daimer-Benz for $36B only to be sold off few years later at only $6B to Fiat. Fiat became Fiat-Chrysler until they merged with Peugeot/PSA and formed Stallantis. Who knows how long Chrysler will last at this point. Ford bought Jaguar-Rover-Aston Martin only to sell of all of them a decade later to Tata Motors for the former two and spun off Aston Martin to a private equity at the time.

What the VW investment said to me was that Rivian's future is secured and probably will become one of the VW brand one day. Perhaps their EV brand while the others will continue to make ICE/hybrid vehicles.

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