THE MORNING RANT: EV Death Pool Update – A Thermal Runaway of Bad News for Rivian, Including Production Shutdown of its Amazon Delivery Van

Because Rivian still has several billion dollars of investor cash to burn through, it’s not at the top of my EV Manufacturer Death Pool. (Lucid and VinFast will likely fail first.) But Rivian is the largest and most over-hyped of the Tesla competitors, having seduced bad investments from major corporations like Amazon and Volkswagen, and from credulous politicians like Georgia Governor Brian Kemp. When Rivian fails, it will be the most spectacular of the overhyped EV bubble companies to fully deflate.

There has been an explosion of additional bad news for Rivian in recent days - you might even call it a thermal runaway. Concurrent with this bad news is a level of corporate reticence that makes me question how forthright Rivian is being about its problems. Specifically, Rivian has suspended production of its much-hyped Amazon vans, blaming the production shutdown on a “parts shortage,” but refusing to specify what the part is. I’m skeptical, especially in light of all the recent troubles these Amazon vans have been having.

You may recall this story from a few weeks ago about the problems Amazon is having with its Rivian delivery vans bursting into flames. There have been several instances, most recently in Houston, where it was initially thought that charging Rivian EVs in normal summer heat (e.g. over 90 degrees) may have been a triggering event for the thermal runaway fire.

“Electric Amazon Delivery Vans Keep Burning Down, And Chargers May Be To Blame” [7/02/2024]

Shortly thereafter, the news broke that Rivian was suspending production of its Amazon delivery vans. Rivian’s excuse sounds like it came straight out of a 2021 press release – “supply chain issues.” Peculiarly, the supply chain issue only affects parts for Rivian’s Amazon vans, not for the rest of Rivian’s lineup. Perhaps a shipment of sliding rear doors was targeted by Houthi rebels in the Red Sea. What is clear is that Rivian seems to be withholding information, as the company refuses to say which missing components are causing the suspension of delivery van production.

Rivian has to stop making electric vans for Amazon; It’s the latest supply chain issue for the nascent EV maker [Jalopnik – 8/16/2024]

Rivian has paused production of its electric van, which it built for Amazon, because of a parts shortage. It’s the latest supply chain issue for the nascent EV maker.

The shortage began earlier this month, according to Rivian, but the automaker declined to say exactly which components were in short supply.

Rivian is a publicly traded company. There is no excuse for it not to provide investors specific details about the “parts shortage.” If this production shutdown is not actually related to a parts shortage, Rivian shareholders will have a solid reason to engage counsel for redress against the company when the stock price goes lower.

A spokesperson for Amazon told Bloomberg it is aware of the issue Rivian is having, but it doesn’t expect to be impacted by it.

Of course Amazon doesn’t expect to be impacted by the Rivian van debacle. It has been clear to Amazon for a long time now that there is no future in these Rivian delivery vans.

But the news for Rivian somehow just got even worse – another thermal runaway fire at its assembly plant, and this one was massive.

“Over 50 Rivian R1T And R1S Models Ruined In Factory Fire; The fire, which broke out at the parking lot, didn't damage the facility, and Rivian says it's not aware of any injuries” [Car Scoops – 8/27/2024]

Fire crews were able to put out the inferno, but not before dozens of R1Ts and R1Ss were ruined. One image captured after the scene shows that Rivian has boxed in 57 vehicles that were damaged in the blaze and positioned them in the corner of its parking lot. The vast majority of the EVs visible have been destroyed and are nothing left but burnt-out carcasses. A small handful appear to have escaped with less significant damage.

Here is a video of the fire. How terrifying would this fire be if it were in a parking garage rather than out in the open?

Since Georgia Governor Brian Kemp has thrown about $1 billion of taxpayer money, infrastructure, and incentives at Rivian, perhaps he can call up his business partners there at Rivian and inquire just what “parts shortage” has caused the Amazon van production shutdown. Whether they like it or not, the residents of Georgia are invested in Rivian, and they are owed an answer as to what is really going on.

[buck.throckmorton at protonmail dot com]

posted by Buck Throckmorton at 11:00 AM

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