{"text":[[{"start":8.35,"text":"Rivian’s chief executive has sharpened his pitch for more big carmakers to license its tech following the start-up’s deal with Volkswagen, warning it is “inconceivable” traditional players will maintain their market share without better software. "}],[{"start":22.35,"text":"“If you don’t have a high level of autonomy, and an increasingly software- and AI-defined vehicle, you’ll lose market share,” RJ Scaringe said in an interview at the electric-truck maker’s Palo Alto office."}],[{"start":35.35,"text":"Rivian is hoping more legacy carmakers will pay for a package of electrical and autonomous software to avoid spending billions on in-house tech teams. "}],[{"start":44.2,"text":"Better-designed circuitry can cut thousands in costs from each vehicle and extend EV range, while self-driving software needs powerful processors and cloud connectivity. Customers are also demanding slicker interfaces and smoother interaction with smartphones and apps."}],[{"start":61.45,"text":"“A bunch of car companies are brute-forcing a way to having comparable features,” Scaringe said. But trying to retrofit older systems and co-ordinate with hundreds of external suppliers was “an immensely inefficient way to deliver software”."}],[{"start":76.3,"text":"Convincing more big-name carmakers to use Rivian’s technology, along with the release of its new mass-market SUV called R2, could help reverse years of steep losses at the start-up. Its shares have plunged 87 per cent since its 2021 initial public offering."}],[{"start":92.94999999999999,"text":"Rivian and Volkswagen next year plan to release the first model under the $5.8bn software joint venture the pair agreed in 2024. The €20,000 electric ID.Every1 will be followed by more upmarket vehicles from Audi, which VW owns. "}],[{"start":110.89999999999999,"text":"Scaringe hoped these vehicles would provide “existence proof” its technology was transferable and attract VW’s peers. The company had “the opportunity to directly monetise [our R&D] with software licensing deals of various types”."}],[{"start":125.69999999999999,"text":"The VW partnership only included electrical architecture and software, but could expand to autonomy, AI and propulsion over time, said Claire Rauh McDonough, Rivian’s chief financial officer. "}],[{"start":137.54999999999998,"text":"Global carmakers have struggled to make the transition to electric vehicles, suffering from poor sales before being hit by President Donald Trump’s decision to end most federal EV incentives. "}],[{"start":149.99999999999997,"text":"Carmakers such as Ford, Stellantis, Honda and GM have taken more than $75bn of writedowns in recent months as they cancel models and supply contracts."}],[{"start":160.94999999999996,"text":"Scaringe said this was not a reflection of lack of demand, but a failure to build good cars."}],[{"start":168.09999999999997,"text":"“A convenient explanation is that people don’t want EVs,” he said. “A number of companies launched products that were OK. They weren’t dismal, but they weren’t exceptional. As a result . . . customers didn’t buy them.”"}],[{"start":181.39999999999998,"text":"He said Tesla’s Model Y SUV, which became the best-selling car of any kind in the world, showed there was an “enormous market” for electric cars. "}],[{"start":190.84999999999997,"text":"Scaringe argued that carmakers had struggled to build their own EV tech in-house because of “cultural differences” between developing software and electronics compared with mechanical systems."}],[{"start":202.94999999999996,"text":"He added many car companies were in the “wrong physical place” to tap pools of software and AI talent, which are concentrated in California."}],[{"start":211.99999999999997,"text":"“You can’t just wish that there were lots of software developers in the Midwest,” he said."}],[{"start":216.99999999999997,"text":"VW invested €12bn in its in-house software division Cariad before turning to Rivian. However, the deal has been controversial internally, with reports of culture clashes and power struggles."}],[{"start":229.49999999999997,"text":"“There are inherently challenges, not because of people or organisation or culture. It’s just hard work” to move from a vehicle architecture focused on hardware to software, Scaringe said."}],[{"start":240.74999999999997,"text":"Income from software deals could prove critical to Rivian, which faces a long road to profitability in the most challenging EV market in years. The start-up sold 42,000 of its flagship R1 trucks last year, but made a net loss of $3.6bn. Its first-quarter sales grew 20 per cent to 10,365."}],[{"start":263.09999999999997,"text":"Scaringe hoped that the imminent release of Rivian’s mid-size R2 SUV would address the $45,000 to $55,000 “sweet spot” in the market, boosting earnings and attracting new customers in the US and Europe."}],[{"start":278.24999999999994,"text":"Last month, Rivian got a boost when ride-hailing app Uber agreed to invest as much as $1.25bn and buy up to 50,000 self-driving R2s by 2030. Rivian also unlocked another $1bn from the VW deal when it passed a winter endurance test in Sweden, which will raise the total it has received to $4.3bn."}],[{"start":301.29999999999995,"text":"But even if R2 hits its 20,000 to 25,000 sales target this year, the company suggests its net loss will only narrow to $2.1bn as it continues to invest to achieve so-called “Level 4” driverless autonomy. "}],[{"start":316.15,"text":"“The path to becoming a very large revenue company requires us at this moment in time to invest,” Scaringe said. “It’s not like, ‘oops we accidentally lost a few billion dollars’.”"}],[{"start":327.15,"text":"Additional reporting from Kana Inagaki, Christian Davies and Sebastien Ash"}],[{"start":338.99999999999994,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1776450284_8768.mp3"}