Rivian CEO Acknowledges Strength of Chinese EV Makers
Rivian founder and Chief Executive Officer RJ Scaringe has openly praised BYD and Xiaomi, calling them among the strongest electric vehicle manufacturers in the world today. Speaking on the On with Kara Swisher podcast, Scaringe highlighted that while China has an overwhelming number of EV brands, only a handful truly stand out for their combination of advanced technology and aggressive pricing. From my perspective, it’s refreshing to hear a US automaker acknowledge competition so candidly instead of downplaying it.
Why China’s EV Market Is Different
According to Scaringe, China’s EV landscape is fundamentally different from that of the United States. With nearly 100 EV manufacturers, Chinese consumers have far more choice. However, Scaringe emphasized that most of these companies lack compelling innovation, while a few, notably BYD and Xiaomi, demonstrate genuine leadership. He specifically pointed to how these companies manage to deliver vehicles that are both affordable and technologically impressive, something many global automakers still struggle to balance.
BYD and Xiaomi’s Rapid Global Rise
BYD, which manufactures both battery electric vehicles (BEVs) and plug-in hybrid vehicles (PHEVs), has expanded aggressively worldwide. Out of the 4.6 million vehicles sold in 2025, over 1 million were delivered overseas, accounting for more than 20 percent of total sales. Xiaomi, despite being a newcomer to the automotive space, has moved even faster. The tech giant began producing EVs in early 2024, yet its SU7 sedan outsold the Tesla Model 3, a milestone no rival in that segment had achieved. Its second model, the YU7 SUV, recorded over 240,000 non-refundable orders within just 18 hours, setting an industry record.
Software-First Strategy as a Competitive Edge
One of the strongest points Scaringe made, and one I fully agree with, is that software-first thinking is becoming the defining factor in modern EV success. Scaringe explained that Rivian was built as a software and electronics company first, with more software engineers than mechanical engineers. He noted that newer Chinese automakers follow the same philosophy, making architectural decisions that give them an edge over legacy manufacturers burdened by outdated platforms.
The Real Reason Chinese EVs Are Cheaper
Despite similarities in vehicle technology, Scaringe stressed that cost structure is where the real difference lies. He attributed China’s advantage to a combination of government subsidies, near-zero cost of capital, and significantly lower labor costs. In many cases, factories and equipment are paid for by the government, while US automakers must rely on equity or debt. Additionally, Chinese factory workers often work 50 to 60 hours a week and earn one-fifth to one-seventh of US wages, making direct competition nearly impossible.
Tariffs, Local Production, and the US Market
When asked about Chinese EVs entering North America, Scaringe said it is very likely US tariffs will remain in place. He believes Chinese automakers would need to manufacture locally to compete, which would eliminate many of their cost advantages. Personally, I see this as a short-term shield rather than a long-term solution, especially as global manufacturing becomes more automated.
Automation as America’s Path Forward
Scaringe argued that the future of US auto manufacturing depends on industrial automation and high-dexterity robotics. According to him, this is the only realistic way the United States can compete with low-cost manufacturing countries. I find this outlook realistic, even inevitable, as automation may soon matter more than labor cost differences alone.
Frequently Asked Questions — FAQs
Q. Why did Rivian’s CEO praise BYD and Xiaomi?
- RJ Scaringe praised them for combining strong EV technology with competitive pricing, driven by software-first design and government-backed cost advantages.
Q. How is Xiaomi competing with Tesla?
- Xiaomi’s SU7 sedan outsold the Tesla Model 3, while its YU7 SUV set record-breaking order numbers, thanks to aggressive pricing and advanced tech.
Q. Why are Chinese EVs cheaper than US-made EVs?
- Lower labor costs, government-funded factories, and near-zero cost of capital significantly reduce manufacturing expenses in China.
Q. Will Chinese EVs enter the US market?
- Scaringe believes tariffs will remain, and Chinese automakers would need local production, which would reduce their cost advantage.
Q. What is the future of US EV manufacturing?
- According to Scaringe, automation and robotics are critical for the US to remain competitive in global EV manufacturing.
