Rivian CEO RJ Scaringe Talks Auto Tariffs
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We welcome our global radio and TV audiences now. EV maker Rivian recently announcing it will be spinning out a new company called Also, with the aim to develop EVs for short trips. $105 million funding from Rivian and VC firm Eclipse. For more, I'm very pleased to say we're welcoming Eclipse partner Jatin Bell and Rivian CEO RJ Scarange. Great to have you both here. And RJ, I start with you. The spin-out of Also Now.

Why is it better now to let it thrive in a solo manner? Well, thanks for having us on. We think about overall transportation space and what needs to happen. Of course, there's electrification of vehicles and the infrastructure that we know of today. And that's what Rivian has been focused on, of course, first the United States and with our R2 program, soon Europe.

But there's a lot of trips and a lot of miles that are much shorter distance and actually work better with something that's a much smaller form factor. And so we kicked off a Skunk Works team a few years ago to look at how we could take our core technology stack and apply it in a very low cost, much smaller form factor. And as that played out, we realized that the idea really had a lot of legs.

powerful idea and we decided that this this idea was big enough to deserve being its own business and so we took the decision to spin it out. Eclipse led the financing of that with a hundred and five million dollar investment as you said and we're really excited about what's to come. We haven't shown any of the products yet but they're absolutely incredible. Let's therefore ask Jitin, how is this relationship going to evolve? What's the sort of closeness you're going to be doing because RJ is going to be on the board?

Yes, I think it's exciting because I spent many years at Rivian working closely with RJ and now in this new role at Eclipse, you know, really excited to invest in this opportunity and really disrupt the micromobility space. Yeah, I'm really excited to partner again with RJ and the Rivian team as well as the also team to bring this vision to life.

Jiten, I ask you the consumer issues here though. We're a little bit worried to say the least about the economy here in the US. Do you think that the consumer is going to be there to back this more than $100 million that you're putting behind this offering that starts to get into our hands in 2026? Yeah, absolutely. I think if you look at the transportation ecosystem around the world, it's under so much of stress when it comes to infrastructure limitations, when it comes to congestion, when it comes to pollution.

And micro mobility is a very important piece of that puzzle. More cars, more buses, more trains is not going to be the answer. You need something smaller, something more flexible to complement those other modalities.

And we believe that micromobility is a perfect solution to that. It's a large market already. It's growing very rapidly around the world. But if you look at the solutions, you know, they're very weak technically, very poor user experience. They lack reliability. And this is where the opportunity is. And I think the consumer is waiting for something more compelling to hit the market.

RJ, it's a global opportunity on micromobility and you just talked about how it's a global opportunity for you right now with Rivian and the R2 rollout. This is a difficult time to be a global business. How are you preparing yourself to access the European market when we're worrying about tariffs and you've always set aside hundreds of millions of dollars in potential policy impacts? Yes, I mean, as you know, it's a very complex environment. As Rivian, we're spending a lot of time

interpreting and understanding what the tariff implications are for us, of course, here in the United States, but I think importantly recognizing that, you know, in particular, Europe may respond. And so how the

Ultimately, the tariff structure sets out and lays out is going to have a big impact on some of the decisions we make over the next year. We're staying very, very close to it. But it's, as you've called out, it's a very dynamic situation. And I think some of the uncertainty is what makes it the most challenging to navigate. RJ, are you in close discussions with the administration itself? Have you been getting a glean on what they're thinking of for the future?

Well, I think one of the things that's important just if we take a big step back from all the noise of what's happening, what's going to happen tomorrow with some of the tariffs that have been talked about and will be rolled out. I think a big step back is there's a clear directive to drive technology and manufacturing into the United States.

And for Rivian, we're a U.S. company. We have just under 17,000 employees here in the U.S. We have a plant in Chicago, just south of Chicago in Illinois. We're building another plant in Georgia. So we're growing rapidly here in the United States. 100% of our vehicles today are produced here and all of our technology is here. So in terms of the administration's objectives, we're very aligned with what's being asked and what I think the overall objective

policy framework is trying to drive towards. But in terms of how that translates to our expansion in Europe and elsewhere, we do have to recognize that it's a very dynamic environment. Our production footprint may be different than we'll be originally planning. But I think all of us across all the different auto manufacturers are waiting to see how things look once the dust settles.

And that uncertainty, Jiten, I'm sure is affecting you as a team of operators, investors. How are your other founders coping with this moment?

Yeah, I think uncertainty is the key word here. I feel that what is in our control is to focus on two things. Making sure that founders building in the physical industries have the maximum control on the stack, you know, on what they design, what they engineer. If you have control over it, then you're able to make decisions to optimize around different environments. And the second thing is to build that responsibility

resilience and flexibility in the supply chain so that it is able to navigate again short-term, medium-term and long-term changes in the policy environment. So I think the key word there for our founders is control the controllables. There are things that are going to change, things are going to change back. I think what is most important is to build a resilient strategy and a supply chain that

within the company that can navigate all these different environments. RJ, a quick 30-second one for you. Do you think you've benefited from people moving away from Tesla for political reasons? Well, one of the things that I think is often missed as we think about electrification is

today only about 8% of new vehicle sales are electric here in the United States. And so when we think about competition and growing our market share, the biggest opportunity is bringing people into our new technology vehicles and introducing people into what it feels like to be in a connected, smart, of course, electric vehicle. And so we really believe there needs to be a lot of choice in order for us to go from 8% to 50% to eventually 100%.

We need lots of successful companies. We need Tesla to be successful. We continue to be very successful. We need Rivian to be successful. We need the existing legacy manufacturers to be successful. And so with our R2 program, it's a much lower-priced vehicle. It's really cool. It's an incredible product. But what that will do is it will give customers another choice. And so we think the presence of another choice is going to be important from a brand and product attributes point of view.

Thank you both so much for your clarity of thought today when there is not much clarity in the economy. Jiten Bell of Eclipse, RJ Skarange of Rivian. Great to have you both on the show. Thank you.

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