Demand for AI components complicates Rivian's procurement of memory for electric vehicles
Rivian CEO RJ Scaringe stated that the company is spending increasingly more time procuring memory chips: the AI boom has made them more expensive and scarce.
Just three years ago, memory was considered a commodity for Rivian that did not require separate planning. Now, the company is optimizing its use at the circuit board level and pre-planning supply sources, Scaringe said.
The reason is the growing demand from companies developing AI and the reallocation of production capacity to more profitable orders. This particularly affects DRAM—dynamic random-access memory. As a result, automakers are finding it harder to obtain the necessary components, and prices for them are rising.
The problems are not limited to memory. Rivian's head of hardware, Vidya Rajagopalan, reported that due to the data center boom, the company has struggled to source e-glass—a material for printed circuit boards. A shortage of one component can disrupt the supply of an entire system. Previously, Rivian also paid little attention to multilayer ceramic capacitors, but now they must be accounted for.
The company is seeking ways to offset the rising costs of memory and other standard components to maintain the announced base price of the R2 at $45,000. At the same time, Rivian is developing its own technologies: the RAP1 processor is expected to appear in consumer R2 models next year. Along with a new lidar system, it is intended to support further advancements in driving automation.
