Electric Vehicle Industry Heading Toward Major Battery Shortage, Rivian CEO Says
Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.
Rivian CEO RJ Scaringe has warned that the electric vehicle industry could face a dire shortage of materials needed to make batteries in the coming years—a problem that he said could be worse than the ongoing semiconductor chip shortage facing automakers.
During a tour of the Irvine-based electric truck maker’s production plant in Illinois last week, Scaringe told the Wall Street Journal that the industry will encounter challenges procuring the materials needed to build enough batteries for the large-scale adoption of EVs—including valuable resources like nickel, cobalt and lithium.
“Put very simply, all the world’s [battery] cell production combined represents well under 10% of what we will need in 10 years—meaning, 90% to 95% of the supply chain does not exist,” Scaringe said. The Rivian CEO described the current semiconductor shortage as “a small appetizer to what we are about to feel on battery cells over the next two decades.”
To cope with the shortages, Scaringe said Rivian is targeting “multiple suppliers” and plans to invest in its ability to build batteries in-house.
Rivian began selling its first models, the R1T electric truck and the R1S electric SUV, last fall and also has a deal with Amazon, one of its largest financial backers, to produce 100,000 electric delivery vans known as the RPV. The production of the Amazon vans is still in early stages, according to the WSJ, with Rivian planning to fulfill the order by 2025.
Despite noting around 83,000 reservations for its trucks and SUVs in March, the automaker only sold a total of 1,227 cars in the first quarter this year, and announced that it was halving its 2022 production forecast to 25,000 vehicles. It also made a contentious move to raise prices on pre-order holders, sparking a backlash that saw the company reverse its decision and Scaringe publicly apologize.
In addition to its Illinois factory, Rivian will soon begin building a second production plant located near Atlanta that is expected to come online in 2024. That facility will produce a smaller, compact SUV called the R2, Scaringe told the WSJ.
Rivian’s production issues have contributed to a more than 60% slide in its stock price this year, with its shares now trading below $40—well off their nearly $180 peak after the company’s November IPO, which briefly saw Rivian become one of the world’s most valuable automakers.
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Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.
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