Written by Cláudio Afonso | LinkedIn | X
Rivian and Bosch are locked in a legal battle over a canceled electric motor supply deal, with both companies filing lawsuits against each other.
Bosch, the world’s largest auto parts supplier, claims the electric vehicle (EV) maker breached a 2019 contract by failing to pay $204 million in reimbursements for canceled orders.
Bosch sued Rivian three months ago, in July, alleging the automaker did not honor a reimbursement clause after canceling the supply deal for electric motors.
Bosch said it had invested millions of dollars to retool plants in Germany and South Carolina to fulfill the contract. The supplier claims Rivian had secretly planned to replace Bosch’s motors with its own in-house Enduro e-motor system.
“While Rivian’s choice to cut costs and develop a new product may be understandable, Rivian cannot simply ignore its contractual duties to reimburse Bosch,” the company said in its lawsuit, according to Crain’s Detroit Business.
Rivian countersued, accusing Bosch of failing to supply the required number of motors and delivering products of poor quality. The EV maker said Bosch’s failure caused a 30,000-unit drop in planned production, damaging its financial performance.
“Bosch made a calculated gamble to overpromise to multiple start-up electric vehicle companies on the theory that at least some of them would soon fail,” Rivian said in its countersuit.
Rivian claims Bosch delivered only 101,000 motors by the end of 2022, less than half of what was contractually required. The company said the supplier’s shortcomings severely impacted its ability to meet production targets.
Despite canceling the contract, Rivian has struggled to produce its own motors. The company reduced its 2023 production guidance by 8,000 to 10,000 units earlier this month, citing ongoing parts shortages that have affected both its R1 and van lines.
In the third quarter of the year, Rivian delivered 10,018 vehicles — a decline of about 36% year over year— and produced 13,157.
Rivian has recently said it expects to produce between 47,000 and 49,000 vehicles this year, down from the previous guidance of 57,000 units.
The third quarter earnings results will be reported on November 7, after market close with the traditional conference call following at 5:00 p.m. Eastern time.
Written by Cláudio Afonso | LinkedIn | X
