Monday, April 18, 2022

🚚 🛻 Rivian’s “production hell”

Plus: Bird-friendly beef | Monday, April 18, 2022
 
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Axios What's Next
By Jennifer A. Kingson and Joann Muller · Apr 18, 2022

Happy Easter Monday! The White House Easter Egg Roll is today.

  • Did you know? California aims to ban gas-powered cars by 2035. Expect other states to do so too.
  • Want a brush with fame? Send us a picture of something that screams, "This is What's Next!" We may publish it. Email: whatsnext@axios.com.

Today's Smart Brevity count: 1,220 words ... 4.5 minutes.

 
 
1 big thing: Rivian opportunity at risk
Image of Amazon electric delivery vans being built at a Rivian factory in Illinois.

Amazon electric delivery vans come off the assembly line at Rivian's factory in Illinois. Photo: Joann Muller/Axios

 

Rivian, the most promising automotive startup since Tesla, has exquisite timing, Joann Muller writes.

  • It's ramping up production of game-changing electric pickup trucks and delivery vans just as gas prices are soaring and people are looking for alternatives to fossil fuels.

Yes, but: Rivian's vehicles are also launching into the teeth of unprecedented, industry-wide supply chain disruptions that could delay or derail the company's ambitious growth plans.

Why it matters: Whether his timing is perfect, or terrible, Rivian CEO R.J. Scaringe's challenge is getting a new electric vehicle brand off the ground while supplying 100,000 promised delivery vans to his company's largest customer and one of its biggest shareholders — Amazon.

  • Already, Rivian has conceded that its inexperience is hurting efforts to secure precious semiconductors.
  • The microchip shortage, along with other supply-chain constraints, prompted Rivian to cut its 2022 production targets in half, to just 25,000 vehicles.
  • The 39-year-old Scaringe, heralded in a 2020 Forbes cover story as Elon Musk's new nemesis, is getting a taste of the kinds of growing pains that the Tesla CEO famously lamented as "production hell."

Scaringe seemed to take all these pressures in stride last week, however, as he drove me in a golf cart around Rivian's 3.4-million-square-foot assembly plant in Normal, Illinois — formerly home to a joint venture between Chrysler and Mitsubishi.

Details: With the flat brim of his Rivian cap pulled low, Scaringe frequently leapt off the cart to offer a closer look at the company's expanding manufacturing operations:

  • The six giant stamping presses where aluminum and steel parts are loudly formed.
  • The automated body shop where scores of robots weld, rivet and glue auto parts together.
  • The pristine paint shop, where trucks and vans do somersaults through a series of giant paint baths.
  • The final assembly area, split in two — one line for Rivian trucks and SUVs, another for Amazon's vans — where items like seats, dashboards and steering wheels are added.

The supply chain challenges of the past year have been more pronounced than he expected, Scaringe says, acknowledging some frustration: "We have a plant with 5,000 people, but we need the parts here to support it."

  • Microchip manufacturers are allocating shipments based on their customers' historical production volumes, he said. That hurts Rivian, which only recently started manufacturing vehicles.
  • "I'm on the phone with semiconductor supplier CEOs every day," he says, trying to convince them Rivian will produce the number of vehicles it says it will.
  • "It's a day-in, day-out battle for allocation and the number we get is precisely equal to the number of vehicles we build."

The bottom line: Rivian, which began production in the fall, delivered a grand total of 920 vehicles in 2021 and has 83,000 customer "pre-orders" in hand.

  • It's not clear how patient those customers will be, given that other electric pickups from GM and Ford are hitting the market now.
  • Meanwhile, Amazon, an expert in fast delivery, is still waiting for its vans.

Read the full story.

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2. New designation: "Bird-friendly" beef
Illustration of a birds peeking through viewfinder holes in a green landscape

Illustration: Sarah Grillo/Axios

 

The National Audubon Society is introducing a new certification program: Cattle ranchers who can show that their ecological practices will restore bird populations will earn the designation "bird-friendly beef" for their products, Jennifer A. Kingson writes.

  • Three billion North American birds have perished since the 1970s, and global warming may push many more to the brink of extinction, per Audubon.
  • Audubon created a "bird-friendliness index" to evaluate conservation success in grasslands, where bird populations are particularly hard hit.

Why it matters: Instead of making war on ranchers and encouraging people to boycott red meat, Audubon is launching its "Conservation Ranching Initiative," which it calls a "market-based conservation approach [that] offers incentives for good grassland stewardship through a certification label on beef products."

What they're saying: "It's a quietly radical move," according to The Counter, a food industry news site. "Historically, U.S. wildlife conservation efforts have focused on preserving habitat."

  • "But Audubon's new strategy is specifically geared toward improving the environmental value of working lands, implying that 'nature' and 'agriculture' are not mutually exclusive entities."
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3. Global warming target still attainable, study shows
Data: Zeke Hausfather; Chart: Jacque Schrag/Axios

After years of bleak projections, countries now have better than even odds of limiting global warming to at or below the Paris Agreement's 2°C temperature target, a new study finds.

Yes, but: This requires all national emissions reduction pledges to be fully met, which countries are not currently on course to do, Andrew Freedman writes in Axios Generate.

  • In addition, the study, led by Malte Meinshausen at the University of Melbourne, finds there is only a faint chance, between 6% to 10%, of meeting the agreement's more aggressive 1.5°C target.
  • The only way to do so would be for countries to commit to far more stringent emissions cuts prior to 2030, and reach net zero by 2050.

Why it matters: Published in the journal Nature, this is the first peer-reviewed study to show such high odds of holding the global temperature increase to 2°C based on world leaders' existing pledges.

Threat level: Warming beyond 1.5 degrees risks calamitous consequences, including the death of warm water coral reefs and irreversible melting of large portions of polar ice sheets.

  • Such warming is especially dangerous for developing nations and low-lying island countries.

What they're saying: Meinshausen told reporters on a conference call that the study offers a warning about the 1.5-degree target.

  • "Our study clearly shows that increased action this decade is necessary for us to have a chance of not shooting past 1.5 degrees by a wide margin," he said.

Keep reading.

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A message from Density

The workplace of the future depends on data
 
 

To reshape cities, we must begin with measuring and improving our workspaces.

Here's why: Offices account for 11 billion square feet in the U.S. but 41% of that was vacant pre-pandemic.

Density arms companies with the data they need to create more efficient spaces and design better experiences.

 
 
4. Charted: Bitcoin's declining dominance
Data: Google Trends; Chart: Jacque Schrag/Axios

There's a vibe shift afoot on the blockchains. "Buy crypto" is edging out "buy bitcoin" in Google searches, Brady Dale writes in Axios Crypto.

Why it matters: Bitcoin has always dominated the crypto market, but if the public is becoming more conscious that there are other options out there, it could threaten Bitcoin's hegemony.

  • "Bitcoin dominance" measures how much of the market capitalization of all cryptocurrencies is represented by bitcoin alone. Until early 2017, it was always over 90%. Now, it's around 40%.
  • "Buy crypto" first pulled ahead in early 2021. Jagger Bellagarda noted the shift at the time.
  • "Buy dogecoin" beat them both a few times in 2021, but it was fleeting.

Be smart: Google Trends doesn't reveal how much searching is going on, but how much search there is relative to other search terms.

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5. A blank canvas
A board of matzo on a plate.

Yes, it's matzo. Photo: Smith Collection/Gado/Getty Images

 

Get more creative than butter: For Jews who stick to matzo during the full eight days of Passover, here are a few recipes that transcend the humdrum of standard matzo brei (basically scrambled eggs with matzo).

  • Joan Nathan's salted peanut and caramel matzo brittle from NYTimes.com.
    • "A layer of caramel bakes on top of then soaks into the unleavened bread, which next gets slathered with peanut butter and topped with crunchy peanuts."
  • "Matzagna," or matzo lasagna, from Delish.
    • "It's the best way to eat matzoh," says Joanna Saltz, editorial director of Delish and House Beautiful.
  • No-bake matzo icebox cake from TheKitchn.com.
    • "I soaked my matzos not in wine but in warm milk, and then layered them with ganache and lots of vanilla-scented whipped cream," says cookbook writer Jessie Sheehan.

The bottom line: If you want to make matzo ball soup, Nathan's recipe seems to be the most popular, per Dr. Google.

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A message from Density

How data can help create a more efficient workplace
 
 

We optimize space based on observation and not data, yet real estate continues to be the second-largest expense line for most companies.

The solution: Data that measures space utilization could lead to better outcomes for companies, employees and cities.

Read how Density can help.

 

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