Rivian CEO says the chip crisis is a “small appetizer” compared with the upcoming batteries crisis

CEO of electric vehicle maker Rivian states that the chip crisis will be a ” small appetizer “ compared to the battery crisis for electric vehicles that is taking shape. CEO RJ Scaringe warns of a serious crisis that will soon hit the electric vehicle industry in which his company is active.

Such a warning was already said by Elon Musk more than 10 years ago, which motivated him to set up battery manufacturing plants so that he would not be dependent on other suppliers. At that time Rivian did not exist so it could not have been prepared like Tesla. Tesla currently has battery factories and is trying to get as many raw materials in the world as possible in order to have them for battery production. Not only do you have a factory, but you also need a regular supply of raw materials for it.

According to Rivian’s CEO, the problem with the lack of batteries for electric vehicles is very similar to the problem with chips. The shortage of chips is not calming down in the world as part of what feeds it is the over-purchase that manufacturers make. It is a process of egg and chickens today. There is a shortage of chips so every manufacturer tries to get as much as possible. Because there is a shortage, all manufacturers buy more than usual and stock up on large stocks. As a result, there is an even greater shortage of chips because the amount of demand in the market has increased unreasonably. The chip crisis goes into some loop and in order to get out of it, one has to increase the quantity offered in the market or break the resulting wheel and go back to reasonable quantity requirements. Solutions that are difficult to implement quickly.

The same problem is starting to be felt with the batteries for the electric vehicles and according to Scaringe, it is only getting worse. He said the company has contacted various suppliers and many business partners in order not to be dependent on just one factor. He further added that at the end of the process Rivian wants to manufacture the batteries itself in order not to be dependent on third-party factors. Currently the company with a supply of batteries and chips will be able to produce 25,000 vehicles this year which is actually half the quantity that it was supposed to be.