“The problem is not the price, it is that Chinese cars are really better”

The founder of Rivian, RJ Scaringe, has launched a warning that can be uncomfortable for the western car industry, especially for how the panorama is in terms of The conquest of Chinese manufacturers. And it is that for the CEO of Rivian, Chinese manufacturers not only compete in price, but have developed superior technology. In his recent statements, the US executive makes it clear that obsessing with the cost of Chinese electric vehicles is a strategic error that can cost expensive long -term.

Chinese technological advantage. During An interview In the podcast plugged-in, Scaringe went straight to the grain: “The alarming, if you look at the entire industry, is that technology is much better.” The CEO does not only refer to lower prices, but to cars that technically exceed the majority of western manufacturers. “They are technically very advanced and more advanced vehicles than most western manufacturers, I would say that Tesla and Rivian are exceptions,” declared Later in the Everything Electric podcast.

More than Smartphones on wheels. While Western brands have been promising to convert their cars into “smartphones on wheels”, China takes time that has achieved it. And today, Chinese vehicles incorporate powerful infotainment systems with voice assistants and even karaoke, with architectures similar to those we commonly see in the consumer electronics sector and frequent software updates. An outstanding example is the Xiaomi Su7that Scaringe described as “an impressively well done vehicle”, especially notable for being the first car of the Chinese technological giant, who have also contributed their great software experience.

The cost is not the background issue. “There are two things that will happen: or we will put tariffs that match the cost, or we will allow Chinese manufacturers to build in the United States. But in both cases, the cost will be essentially the same,” explained Scaringe “There is nothing magical when disarming it that allows these really impressive cost structures. There is nothing secret and magical,” said the manager. Chinese advantage comes from government subsidieslower labor costs and a lower capital cost.

The reality of supply chains. The Rivian CEO also addresses a crucial point that tariffs cannot resolve: the dependence on critical materials. “We don’t have the same geological advantages we had in the fossil fuel area,” pointed outexplaining that your company needs nickel for batteries, but the greatest world production is in Indonesia, not in the United States.

The real challenge is about to arrive. Scaringe admits that when commercial barriers are reduced or Chinese manufacturers establish plants in the West, competition will be decided by technology, not for the price. “They will win in technology,” he warns. “If I were a current manufacturer, I would worry less about the cost and focus more on cars are really better,” says the manager.

The founder of Rivian has not been the only one to recognize this point, since Ford He also recognized That China has “much higher vehicle technology” and is developing new platforms specifically to compete. In Europe, a multitude of Chinese brands begin to establish themselves, with Byd as main flag bearer. Tariffs are the weapon of the European Union to stop that mismatch in competition, but it will be difficult.

Cover image | Patrick T. Fallon and Rivian

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