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Amazon just started a delivery van war - YouTube
Channel: Donut Media
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- The year of our Lord,
2022 is primed to be
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a massive year for electric vehicles.
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A new generation of EV trucks and SUVs,
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along with a gaggle of sedans and coupes
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will all be hitting the market.
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However, there's a special
model in rapid production
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that may surprise you.
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Delivery vans.
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Yes, you heard that right.
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Those boxy rascals bombing
around our neighborhood
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are as much a priority for
some auto manufacturers
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as any other EV model.
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The major reason for this?
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One Jeffrey "Preston" Bezos.
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Space cowboy wants vans.
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Lots and lots of vans.
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So many in fact, that on
January 5th Amazon announced
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that they're collaborating with Stellantis
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to manufacture thousands
of EV delivery vehicles
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for Bezos' massive fleet.
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The fact that this is a high
dollar agreement is news enough
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but the deal also made headlines
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because it had an
immediate negative impact
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on last year's Cinderella EV
truck maker, Rivian Motors.
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What's crazy is that Amazon
is a major investor in Rivian
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but with this delivery van pivot,
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Wall Street enthusiasm for the startup
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has significantly waned.
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All this drama makes a guy wonder,
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what's really going on over at Amazon?
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Will Rivian be able to compete now that
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legacy auto makers are
hitting the EV market?
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And by the way, what
the hell is Stellantis?
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- Breathe in and out, good.
[81]
Mindfulness and controlled
breathing are great practices
[83]
for managing stress, but
you know what else is?
[85]
- [Deep Voice] Going off-road.
[87]
- Find yourself and share in the chillness
[89]
with this new shirt.
[90]
- [Deep Voice] Find yourself
[91]
- Flowers, butterfly, toadstool, frog.
[94]
All around you, all around
mother earth and only $29.98.
[100]
- [Deep Voice] So much cheaper than $30.
[103]
- Available now at donutmedia.com.
[105]
Go find yourself the chillest
shirt we've ever made.
[110]
Namaste, my dudes.
[112]
- [Deep Voice] (whispering)
Namaste, James.
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- What? Who said that?
[116]
- We all know that whenever
Amazon makes a move,
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it usually affects thousands
of people and tons of money
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and the recent shakeup in
their automotive vision
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is no exception.
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Amazon was vital to
Rivian's rise, pumping over
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a billion big ones into the
startup over the last few years.
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This led to Rivian bringing the first
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fully-electric pickup
truck to the marketplace.
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2022 motor trend truck
of the year, the R1T.
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A big stipulation of the
investment was that Rivian
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crank out a hundred thousand delivery vans
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for Bezos by 2025.
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This massive order, along
with their impressive numbers
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of R1T pre-orders led to
a wave of Silicon valley
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and Wall Street buzz that
culminated in Rivian's
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wildly successful IPO last November.
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But as weeks have gone on,
we've seen Rivian's stock prices
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significantly drop, which
many of you mentioned
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in the comments on the the
last video we did on Rivian.
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Peaking at $172 a share just
days after they went public,
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they now hover around 60 at
the time we're shooting this
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with no obvious sounds of bouncing back.
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A major reason for this financial dive
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is that they just got a
bigger, stronger, richer
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van-producing step-sibling, Stellantis.
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Never heard of Stellantis?
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Well, don't be too hard on yourself
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because the company is
less than a year old.
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Actually, company is
probably the wrong word.
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Multinational automotive
conglomerate is more like it.
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Yes, what sounds like a
supplement or waterpark
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is actually a
Netherlands-based corporation
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that represents 14 different brands
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including Dodge, Alfa Romeo and Maserati.
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Just think of them as the
shiny new Fiat Chrysler
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and the fourth largest
automaker in the world.
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Now let's be clear, this is not Amazon's
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first dance with Stellantis.
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They've been providing Bezos
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with thousands of commercial vehicles
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in the U.S and Europe since 2018.
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This new announcement was
centered around vehicle software,
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specifically in-car dashboard
software and cloud services.
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The platform has been dubbed
the STLA smart (beep) pit
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and is expected to run in
millions of Stellantis vehicles
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starting in 2024.
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The idea is that by using AI
enhanced and Alexa-enabled
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voice assistance, the smart
(beep) pit will integrate
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with customers digital profiles to create
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a personalized in-vehicle experience.
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For example, when your
ex-wife's new husband
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takes your kids on vacation
in his Chrysler Pacifica,
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he might use the family trip planner
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which will recommend
entertainment, restaurants
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and other fun activities along the drive.
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(sighs)
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Let's say you need to get outta town...
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to collect your thoughts.
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Way, way out of town,
alone in the wilderness.
[265]
New Jeeps are expected to
feature a digital coach
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to help calibrate the vehicle
and optimize performance
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before you head off-road.
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This all sounds pretty harmless, right?
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I mean, an Alexa in a Dodge
shouldn't spell doom for Rivian.
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So let's figure out
what's making this deal
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such for the baby brand.
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Well, Bezos currently has
70,000 delivery vehicles
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on the road, with his last mile program
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calling for hundreds of
thousands more by 2030.
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Last mile delivery makes up 53%
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of Amazon's shipment expenses,
a number sure to rise
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considering their stated long-term goals
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and beyond the obvious
environmental benefits,
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consumer reports included
that in the long run,
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EVs can cost 10 to 40% less
than their gas powered peers.
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This potential savings is a huge incentive
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for Bezos to transition to
an all EV fleet even faster,
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not to mention how much
that larger van Armada
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will bolster his competitive advantage.
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Quote, "No matter how you look at it,
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the massive lifetime savings of EVs
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could be a game changer."
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says consumer reports' Chris Harto,
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quote, "As battery prices
and technology improve
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and prices come down, it's
only going to get better."
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All this means that 2022
is pretty much guaranteed
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to be a record breaking year in terms of
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sheer number of EV vans produced.
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Specifically,
Stellantises'... Stellantis'?
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Stellantis' battery
electric Ram ProMaster,
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which Bezos will be the
first commercial customer
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when it rolls off the line in 2023.
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The ProMasters' expected to offer a range
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of around 200 miles and Stellantis says
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they were creating software
with input from Amazon
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before this deal was even announced.
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This new gen van will
probably have similar features
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to Stellantis' already
running in Europe delivery EV,
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the Fiat Ducato.
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Active driving assist, a 360 degree camera
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and a bunch of advanced safety features
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like traffic sign recognition,
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full speed forward collision warning
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and drowsiness detection
are expected to lend
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a helping into the brave
souls driving these mothers.
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See, this is what made Rivian investors
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quake in their boots.
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They were basically like,
"What the hell happened
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to the hundred thousand vans
Rivian was supposed to make?
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Why is Stellantis suddenly in the mix?
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Something must be terribly wrong!
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But let's think about
this for a second, folks.
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It'd be truly insane for a
company as large as Amazon
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to hinge their automotive
future on one company alone.
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Amazon makes millions of
deliveries every year,
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so if there's a hitch with one
of their EV making partners,
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it makes total sense to
have another manufacturer
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in the bull pen.
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Let's also keep in mind that
Rivian didn't convince Bezos
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to invest because of a
delivery van concept.
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It was their revolutionary pickup truck.
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Only a few short months ago,
Edmunds raved that quote,
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"The R1T is the quickest
and best-handling truck
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we've ever tested." while
MotorTrend said that it's, quote,
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"The most remarkable
truck we've ever driven."
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Out of over 70,000 R1T pre-orders,
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only 920 have been delivered so far
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at the time of this recording.
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Think about when more hit the streets
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and people can judge them
by their actual performance
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rather than stock market websites.
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A little while ago, I had the
pleasure of getting behind
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the wheel of R1T and
I can promise you that
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the chatter about these things
is only gonna get louder.
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You might think of gadgets when
you hear all-electric truck
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but Rivian's commitment to
practicality over gimmicky tech
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is obvious the second you sit down in one.
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Now that's not to say there
isn't a slick trick or two
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because there are many,
I'm just saying it's nice
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to not immediately feel like
I sat down in an arcade.
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Man, remember arcades?
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We had one and then it shut
down 'cause nobody went to it.
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Unlike the friggin' internet
cafe featured in Teslas,
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the R1T has only two low-profile screens.
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One is your cluster, the other controls
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literally everything else in the vehicle.
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While I do miss having knobs
to turn for climate control
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because I'm a 56 year old man,
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I was impressed by the incredibly
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user-friendly touchscreen display.
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You can tweak cornering,
take off, sport mode,
[485]
shock absorption, and ground
clearance all on the fly.
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It's very, very impressive,
[489]
and as far as power goes,
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we definitely weren't disappointed.
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As you can see in this video,
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the zero to 60 in three-ish
seconds is absolutely no joke.
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That's me with my stomach in my throat.
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Among other pleasant surprises
were the heartbeat blinkers.
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Instead of the click click click,
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and basically every car blinker ever made,
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Rivian created a sound
inspired by the human heart.
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This was an oddly satisfying feature
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and just one of the sneaky,
cool things that made
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the R1T driving experience
super memorable.
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Now I didn't take this puppy
mountain climbing in Yosemite,
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but after an hour of testing
the truck around in town
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we can say it's definitely worth the buzz.
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Literally everything on the truck worked
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and everyone we met at Rivian
has been very knowledgeable,
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friendly and most importantly, passionate.
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2022 will be a legendary EV year,
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particularly when it
comes to trucks and SUVs.
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It'll be awesome to see
how the R1T stacks up
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against competition like the
Ford lightning and GM's Hummer,
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and all this van drama aside,
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there's still plenty to be
excited when it comes to Rivian.
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They say they're expanding
annual production capacity
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from 150 to 200,000 vehicles a year
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and have plans to have their second plant
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rolling in Georgia by 2024,
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and keep in mind that Amazon hasn't sold
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any of their 20% stake
in Rivian, saying quote,
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"We always knew that our
ambitious sustainability goals
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in our last mile operations would require
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multiple electric delivery van providers.
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We continue to be excited about
our relationship with Rivian
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and this doesn't change
anything about our investment,
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collaboration or order size and timing."
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Look, I'm not gonna
pretend that Wheelhouse is
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a stock market show, but
we do know about cars,
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which is why after driving the R1T,
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I think investor reaction
to the Stellantis deal
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is a little over dramatic.
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Amazon is gonna buy a
tidal wave of delivery EVs
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over the next several
years and as a result,
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Rivian still stands to generate
billions of dollars in cash
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even with this new Stellantis deal.
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So while this Wall Street
news understandably
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started some nervous Rivian fans,
[597]
you can probably chill
out and enjoy this year's
[600]
new wave of thrilling
EVs with the rest of us.
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As they say, a rising tide lifts all ships
[606]
and if Amazon's buying a
bunch, bunch, bunch of EV vans,
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that's quite a big tide.
[614]
Thank you very much for
watching wheelhouse.
[615]
We're gonna take a break
from the stock market,
[618]
investing kind of videos
over the next few weeks.
[622]
We've done a lot of 'em it feels like.
[623]
Follow Donut on all
social media @DonutMedia.
[626]
Follow me @NolanJSykes.
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Be kind, we'll see you next time.
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