RJ Scaringe - Rivian Tore Apart a Xiaomi EV and Discovered What America Can’t Match [POSTS DELETED AND THREAD LOCKED DUE TO POLITICS]

[Zoidz]

CarScoops

Rivian chief executive RJ Scaringe revealed his team recently tore down an SU7, and, likely Farley, he’s full of praise for it. However, he says that developing and building a vehicle like it in China is very different than doing the same in the US.

How Good Is It?

According to Scaringe, the SU7 is a “really well executed, heavily vertically-integrated technology platform” that is “nicely done.” He added that if he were living in China, it’s one of the cars that he’d personally consider buying.

One of the SU7’s most compelling advantages is its price. With a starting figure of 215,900 yuan, roughly $30,000, it undercuts much of the competition. After taking the car apart, Scaringe explained that Rivian “learned nothing from the teardown” about how Xiaomi keeps costs so low.

There was no hidden engineering trick or obscure cost-cutting secret waiting inside the panels. The real explanation, he said, is simple: China’s extensive government support.

China Plays By Other Rules
The distinction, according to Scaringe, comes down to the economic landscape in which Xiaomi operates. State backing shifts the financial balance from the ground up, creating an environment that’s nearly impossible to replicate in the US.

“The cost of capital is zero or negative, meaning they get paid to put up plants,” Scaringe told Business Insider. “It’s a very different opportunity.”

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[kurtlikevonnegut]

No surprise there for anyone who understands how the PRC operates. They subsidize specific industries to muscle out competition so that they can create a hegemony of state sponsored manufacturers.

They will gladly sell vehicles at an operating loss for as long as necessary to drive their competitors out of business.

 

[Donald Stanfield]

China cannot do that forever, as artificial government spending creates other problems. With our country's government bitching over minuscule subsidies to advance technology, it is clear we do not have the market for it. It's not about being green, it's about the future of tech and manufacturing. This is why we should have age and term limits for government. Most 80-year-olds can barely turn a computer on; it's not their fault that their generation didn't have this sort of tech. Expecting them to have the foresight on the direction of tech and its importance isn't going to work.

 

[savethemanual]

I believe Xi was an engineer too so he's got more of a technical view of the world. You've got to hand it to him though, subsiding renewables and EV's is very much in line with long term thinking and where things are headed.

 

[kurtlikevonnegut]

What I mean by only so long they can do it, is before their currency collapses along with their entire economy. Their stranglehold over the country's people means they can keep doing it for a long time, but it's not sustainable.

Fair enough, but my point is that they have enough natural resources and industrial capacity to sustain that for long enough to muscle out a significant amount of competition. They can hold out for 10-15 years easily, plenty of time to drive out significant portions of the competition.

China is always playing the long game.

 

[Riviot]

They subsidize specific industries to muscle out competition so that they can create a hegemony of state sponsored manufacturers.

What I mean by only so long they can do it, is before their currency collapses along with their entire economy. Their stranglehold over the country's people means they can keep doing it for a long time, but it's not sustainable.

Looks familiar.

http://www.iowapbs.org/iowapathways/artifact/1590/impact-world-war-ii-us-economy-and-workforce

 

[DuoRivian]

Fair enough, but my point is that they have enough natural resources and industrial capacity to sustain that for long enough to muscle out a significant amount of competition. They can hold out for 10-15 years easily, plenty of time to drive out significant portions of the competition.

China is always playing the long game.

China does play the long game but at least under both Trump and Biden Chinese EVs are not for sale in the US and that safeguards the domestic auto industry. Europe belatedly realizes this as China dumps subsidized EVs in their market.

 

[UnsungZero_OldTimeAdMan]

I believe Xi was an engineer too so he's got more of a technical view of the world. You've got to hand it to him though, subsiding renewables and EV's is very much in line with long term thinking and where things are headed.

Much more. This Vox feature from a year ago paints a portrait of a cunning genius (and ruthless sociopath). Makes the ballroom fetishist look like Forest Gump.



Xiaomi literally translates to “small rice kernel”. It got its start by aping Apple. Starting with an Android based operating system (August 2010), then a smartphone a year later.

 

[Donald Stanfield]

China does play the long game but at least under both Trump and Biden Chinese EVs are not for sale in the US and that safeguards the domestic auto industry. Europe belatedly realizes this as China dumps subsidized EVs in their market.

That's only going to work for so long. Two things happen when you subsidize a technology. 1. You get your products to market at an unfair advantage over your competitors. 2. You continue to innovate and improve your technology.

If China is allowed to continue improving and innovating, its EVs would eventually be so much better than anyone else's that they would no longer need subsidies.

 

[UnsungZero_OldTimeAdMan]

That's only going to work for so long. Two things happen when you subsidize a technology. 1. You get your products to market at an unfair advantage over your competitors. 2. You continue to innovate and improve your technology.

If China is allowed to continue improving and innovating, its EVs would eventually be so much better than anyone else's that they would no longer need subsidies.

No system is sustainable. Resources on the planet is finite. The question is who runs out of steam first. Their rapid growth lead to boom then bust for a large portion of population. As western media got wind of their unemployment problem, they stopped releasing economic reports. Sound familiar?

And one of the reasons their state subsidizes industry is to keep as many citizens employed as they can… because idle hands and empty stomachs cause trouble. Same reason they overproduce. Since their own population can only buy so much, they’re desperate to export that overproduction (which is why tariffs and import restrictions piss them off). Their military is undergoing aggressive development and expansion too. Spending vast amounts. Yes, it will all come to a head. But when? Taiwan would rather not find out. But they probably will.

 

[Zoidz]

China does play the long game but at least under both Trump and Biden Chinese EVs are not for sale in the US and that safeguards the domestic auto industry. Europe belatedly realizes this as China dumps subsidized EVs in their market.

And a corollary to this is that due to the anti-EV sentiment in the US government these days, the majority of US car manufacturers have probably permanently lost European EV sales to China due to not reaching critical mass. Specifically, Ford and GM have a European ICE market, they will almost certainly never have a European EV market. Rivian may survive as a niche player in Europe with the R3.

 

[UnsungZero_OldTimeAdMan]

And a corollary to this is that due to the anti-EV sentiment in the US government these days, the majority of US car manufacturers have probably permanently lost European EV sales to China due to not reaching critical mass. Specifically, Ford and GM have a European ICE market, they will almost certainly never have a European EV market. Rivian may survive as a niche player in Europe with the R3.

I think while Ford and GM are pulling back, behind the curtain they maintain a certain level of R&D—to avoid being caught with pants completely down once conditions change. But production is not something they can spin up at the flip of a switch. So, when EVs regain momentum, they will suffer consequences.

 

[CrazyOne]

That's only going to work for so long. Two things happen when you subsidize a technology. 1. You get your products to market at an unfair advantage over your competitors. 2. You continue to innovate and improve your technology.

If China is allowed to continue improving and innovating, its EVs would eventually be so much better than anyone else's that they would no longer need subsidies.

They also get to build at scale, which makes it impossible for others to compete.

 

[HaveBlue]

Central and South America is all going gbt. The Chinese are taking 3rd world ev sales.

 

[docwhiz]

China cannot do that forever, as artificial government spending creates other problems. With our country's government bitching over minuscule subsidies to advance technology, it is clear we do not have the market for it. It's not about being green, it's about the future of tech and manufacturing. This is why we should have age and term limits for government. Most 80-year-olds can barely turn a computer on; it's not their fault that their generation didn't have this sort of tech. Expecting them to have the foresight on the direction of tech and its importance isn't going to work.

The US is in much worse shape with much more debt than China.
The difference is that the US goes into debt to give tax breaks to rich people. China invests in technology and their people.
Which is the better policy?

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