Rivian's Strategic Battery Stockpile Offsets Tariff Impact
Rivian proactively secured a significant supply of batteries for its electric trucks, SUVs, and vans before and after the 2016 US presidential election. This strategic move aimed to minimize the financial impact of the Trump administration's tariffs on imported auto parts, according to a report by Bloomberg News.
Pre-Election Battery Acquisition from China
Before the election, Rivian reportedly purchased an undisclosed quantity of lithium iron phosphate (LFP) batteries from Chinese battery manufacturer Gotion. These batteries were primarily intended for Rivian's electric delivery vans, a significant portion of which are produced for Amazon.
Post-Election Battery Inventory from South Korea
Following the election, Rivian collaborated with Samsung SDI to import a substantial volume of batteries from South Korea to the United States. The exact timing of this transaction remains unclear, according to the Bloomberg report.
Tariff Mitigation and Price Pressure Relief
These stockpiled batteries are expected to alleviate the pricing pressure stemming from the Trump administration's tariffs on imported auto components. While the tariffs were later adjusted, offering some relief compared to the initially proposed 25% across-the-board tax, price increases on new vehicles were still anticipated, as reported by the Free Press. Rivian's proactive approach to securing battery supplies demonstrates a strategic foresight in navigating the complex landscape of international trade and tariffs.
