Mate Rimac is one of the most important single figures in the electric car revolution. Not only is he building what will be the fastest-accelerating production car of all time in the barnstorming 1,914-horsepower Rimac C_Two, he also joins Elon Musk as one of the only people in the last hundred years to successfully start a new car company and make a proper go of it.
Rimac Automobili finds itself in an extraordinary position in 2020. Alongside the hypercars it’s making, it is becoming a worldwide technology leader in high-performance electric motors and powertrains, and has made the incredibly rare leap to become a tier one supplier for a host of other brands, ranging from the ultra exotics, such as Pininfarina, to high end like Porsche and affordable volume manufacturers like Hyundai/Kia. The technology side of the company now threatens to be much bigger than the hypercar side.
All this, while its bright-eyed and personable founder is just 32 years old. Mate Rimac has navigated some stormy seas building his little Croatian company up into the fast-growing machine it is today. He’s taken extraordinary responsibilities on his shoulders and built up the sort of business that he believes can endure tough times like the current COVID-19 shutdown.
Rimac made time during a 12-hour run of videoconferences to have a great chat with us about the coronavirus situation, the C_Two hypercar, the powertrain technology side of the business, electric vs combustion performance, building the business, and what lies ahead.
We’ve reproduced this conversation in slightly edited form for you below. Enjoy!
Loz: You guys are pretty much all working remotely?
Yeah. It’s two and a half weeks already for us.
Loz: and what sort of stuff can you get done?
Well for me, it’s very productive personally. But the company, I’d say the home office workers, the white collars, it’s maybe something like 70% efficiency, but the problem is the production, and the people that have to come to work to do something with their hands. They’re at zero.
Loz: What’s the situation for you guys, do you need to continue paying wages? Are there government assistance programs?
They’re just coming up with some assistance programs, but for us it’s not really moving the needle. It’s more targeted for very small companies, mom and pop shops, things like that. But we have announced already that we will pay full salaries, regardless of whether people can or can’t work, and that we won’t let anybody go. We have guaranteed our employees job security no matter what the government does.
Loz: You’ve taken it on your own shoulders. That’s stressful!
Yeah, but I have to admit, I’m pretty calm. We have been in many very difficult situations during the history of the company. Many times, we were running out of money, and many times we had to survive on the last drops. We should’ve been bankrupted by all of those. But we are now in quite a comfortable cash situation.
So we’re making a plan to survive, at a minimum, until the end of the year, if the situation continues. Which is pretty good; if you look at the graphs of how long companies can survive on their cash reserves, the median is 27 days.
Loz: You’ve just had this round of investment from Korea, yeah?
That was in the summer of last year, yeah.
Loz: And that’s your buffer there?
Both, we have revenues from 2012 already, from the beginning of the company basically, the company was brought up in Croatia, where you don’t have venture capital finds. There was not a single one at the time. No government support, no investors, none of the foreign investors wanted to invest in a Croatian company. So we had to start making money from the beginning.
We were profitable from the beginning, basically, except for two years. So we have ten years of history, and eight years of profitability. It’s normal for a normal company, but if you look at the startup automotive space, where you have all these companies now with billions and billions of funding, from the Chinese, from all kinds of sources, we’re very unique.
Because of those tough situations we had at the beginning, we had to be quite different. That’s why we’ve created, let’s say, a frugal culture. We learned how to do a lot of things with very little money. We don’t want to be in those situations again where we are tight on cash. So we’re preparing now with a long-term plan.
Loz: Right. As you say, there’s a whole bunch of new car companies popping up, a lot of them with these insanely ultra-exotic, super-fast hypercars. What is it about these times that’s breeding so many hypercar companies?
You had it always. Every year in Geneva, for decades, you had them appear and disappear. Year after year.
Making cars is one of the hardest things you can do. Elon Musk, who’s doing lots of things in his life, he’s said the hardest thing in his life is to keep the car company alive.
A proper car is the most complex product you can build. Aviation is more regulated, but the car is more complex than the airplane. So very few people can do this. If you look at the last five or six or seven decades, the only big new car company in the Western world has been Tesla.
When you look at the small car companies, it’s Koenigsegg and Pagani. But you have hundreds if not thousands of attempts at building sports cars, luxury cars, hypercars, whatever. And all of these guys appear, then disappear a few years later.
It’s one thing to present a concept at a car show. It’s a totally different thing to build a car that you can actually sell, and that’s road legal and so on. And again it’s totally different to make a business that can survive based on that. The only two guys that have done it are Christian Koenigsegg and Horatio Pagani.
Loz: It’s a good point you raise, and it got me thinking about the C_Two. I looked at it and thought wow, making a 2,000-horsepower electric powertrain, is that not enough of a challenge? Why are you jamming all this other stuff in there like the self driving capabilities, and all the other crazy stuff you’re putting into that car? What was the thinking there?
(laughs) Well, we didn’t want to be a one-trick pony! We wanted to make a really high-end car. The self-driving thing, it made our lives maybe twice as complex in the development of that car.
For example, all small manufacturers have a hydraulic steering rack. But it’s not because it feels better, it’s because it’s cheaper. To have an electric steering rack, it’s a lot of development, it’s very difficult to do, and it’s very expensive.
But with a hydraulic steering rack, you can’t do self-driving functions, because there’s no way to control the steering without driver input. So we had to have redundant electric steering rack and a redundant brake-by-wire system – because you have to have redundancy in safety features – to enable those things.
So it made our lives so much more difficult. And there were so many more things we had to do, compared to other small companies. There’s a whole thing called functional safety, which is raising the complexity to another level. It’s all about making sure the systems in the car work properly.
We wanted the C_Two to be, well, everything. It’s not like an Aston Martin Valkyrie, which is very focused; it has one purpose, and that’s to be faster than a Formula One car. But it doesn’t have any comfort, or cool connectivity features or anything like that.
We wanted our car to be comfortable, to have luggage space, be super powerful, to have the best technology. Infotainment and connectivity are top-notch, you have space inside, it’s easy to get in and out, it’s globally homologated.
So it’s trying to tick all those boxes – and usually, at the start of a project, you want to tick all the boxes, but along the timeline you realize this is too difficult, and that’s too expensive. But now, as the project is coming to an end, we have ticked all those boxes with a very, very small production volume car. I think that’s very unique.
I mean, if you look at other small car companies, they use stuff from other cars. Pagani uses an AMG engine. Or they have very simple infotainment systems and things like that, which makes their lives a lot easier. And that’s the right thing to do for them; I don’t say that’s the wrong thing to do.
But we have designed absolutely everything from scratch, from a white sheet of paper, for that car. There is no carry-over from any other car. There’s no carry-over from our previous models. That’s very rare.
Loz: You just enjoy a challenge, eh?
Haha yeah! If it was easy, more people would be doing it!
Loz: Fair enough. So where are things at? Last we saw from you guys was some on-road video of the test cars I believe.
Yeah, so we intended to ship the first cars this year. With the COVID situation, that’s probably not going to happen. We rely also on other people, for example, for things like homologation.
So for example, we have done some crash tests already, but we need to crash many more cars, we need to do all kinds of testing on all kinds of tracks. We can’t go to most racetracks tracks, because they’re outside Croatia.
We do a bunch of things on computers. Simulations, developments, processes and so on. We’re doing those things right now.
We have a few running prototypes, which you’ve seen in the videos. Yesterday we started track testing again at the only track we can use, which is one here in Croatia. So we’re trying not to lose all this time while things are down. We can do a lot from home, and we’re trying to have a skeleton team in the company that can build up the prototypes so at least this part can continue.
But also we can’t get parts, because borders are closed and so on, so it’s a bit difficult! (laughs) But the goal is to finish the development of the car within this year, and begin shipping next year if this situation doesn’t last too long.
Loz: Have you personally had a chance to drive the development cars?
Oh yeah, I’m doing that all the time, of course!
Loz: What can you tell me? What’s it like?
Well, for me when I drive it, it’s not like it would be for somebody else. In that type of car, when you do such a complex product development, you don’t have a moment where you just flip a switch and it’s on. You gradually increase performance, you increase speed. You increase reliability. You add features and functionalities.
So every time I drive the car, I test something new. A new piece of software, a new suspension setup, whatever, and whenever I’m in the car, I’m just monitoring all the information, all the data points, trying to listen to every tiny squeak or rattle, trying to feel every bit of the car. So when I’m in the car, I’m basically just running all the systems through my head, understanding how the systems are performing, if they’re performing according to spec.
So it’s not like I hop in the car and say “whoa, it’s amazing” or anything like that. It’s a gradual build-up of the features, of the performance, and a gradual removing of issues we find.
Loz: All you’re seeing is the problems!
Exactly! That’s the CEO’s job. The hardest problems that can’t get resolved, they come up to the top at the end! That’s my job: problem solver.
Loz: That’s why they put your name on it!
(laughs) Yeah. But under that, we’ve tried to make a really good passive car from the beginning. You may have seen the Top Gear video; they’ve driven the car. Passive basically means without torque vectoring. So we have four motors, and with torque vectoring, we can do some pretty incredible things. But it’s easy to let yourself ignore some issues on the fundamentals of the car and just say “eh, we’ll solve that with torque vectoring.”
We didn’t want to do this. We wanted to make a really good car without torque vectoring, and then build on top of that. So the car performs really well now, it’s very safe, very usable, very easy to drive even with 2,000 horsepower – for anybody, without those systems.
And now with those systems, we can add more driveability, more agility, make the car feel lighter through the torque vectoring, make it feel more playful during drifting. With this software, you can do endless combinations and endless things. Whatever we’re doing now, it’s just scratching the surface, and we’ll make sure our customers have a car that continues to get better and better over time.
Loz: That’s something Tesla’s really nailed, isn’t it? These over-the-air updates that suddenly give you car more capabilities. What a wonderful thing electrics are in that regard. Hey, how much horsepower can a set of tires handle?
It’s actually much more than people think. The thing that gets tires to the limit is the torque. Not horsepower.
Loz: Right, but electrics tend to have much more torque than your average combustion motor, right?
Yeah, but they usually only have one gear. It’s like driving your combustion car in the highest gear. I’ll give you an example. We have 2,600 Nm on the four motors combined. But with the gear ratio we’re using, we have something like 11,000 Nm at the wheels.
The Bugatti Chiron has around half the torque that we have. But, from memory, they have something like an eight-ratio transmission. So at the wheels, they’re making something like 18,000 Nm in first gear. By second gear, they’re already below us, and as the gears go on, they have less and less torque, which means less acceleration.
So you can’t really compare it. People make this mistake of comparing the torque of electric cars on the motors, but it’s absolutely irrelevant. The torque on the motor shaft is absolutely irrelevant if you don’t know the transmission ratio. Torque on the wheels is what gets you going.
So to answer the question, the tires are on the limit until about 100-120 kmh. So at any time below that, you can get the tires over the limit and spinning. But above that, you have more traction than you have power.
So people ask me sometimes “when is this going to stop? When is enough power?” And I’m saying there’s still a lot of potential in tires.
Loz: That’s interesting! When I first floored it in a Tesla, I couldn’t believe how fast that thing could accelerate to 100 km/h. It just didn’t feel possible. So I had it in my head that electric horsepower figures are deceptively low, like a 700 horsepower electric might outperform a 900 hp combustion car.
Yes. But it’s for different reasons. It’s consistency and easy control. You can see on YouTube, we have drag races against LaFerraris and Porsche 918s, Bugatti Veyrons, whatever. But actually, you’re seeing the runs where the competitors got a good start. You’re not seeing the runs where they got a bad start. It takes them like five or six times to try to make a run until they actually get it right.
So if you’re at a traffic light and you really want to accelerate, you have maybe a 20% chance that you’ll actually nail it. The car might jerk off the line, or stall, or the traction control doesn’t release the clutch properly, whatever. It’s much more complex than an electric car.
In our car, you just floor it, and every time you’ll get the same acceleration. So anybody can do it. If you look at all the drag race videos of Teslas vs Ferraris and whatever, you’ll see in the comments people saying “yeah, but the other guy didn’t start properly!” Right! Because it’s hard to do! With a Tesla, you’ll get it right every time. With a Lamborghini, you won’t. That’s the difference. So it’s not just getting the result, it’s getting the result every time.
Loz: What fun! I have to experience what 2,000 horsepower feels like one day. I’m a motorcycle guy mainly, but I’m man enough to admit that might just blow my mind.
Yeah, ours will be the fastest accelerating car in the world, regardless of electric, combustion or hybrids. The great thing is, the acceleration doesn’t slow down as you increase speed. It has so much power that the acceleration just continues. It’s pretty crazy!
Loz: Wild stuff! This agreement you’ve signed with Hyundai/Kia to produce the electric powertrains for their performance divisions. Where are your major business areas going to be?
On one side, we have the supercars. You’ve seen what we’re doing there, that’s where we want to set the bar and show what the technology can do. On the other side, we have the technology business, where we used the technologies we’ve developed to help other car manufacturers make exciting electric cars.
That’s where we’re expanding a lot. That’s why Porsche has invested in us, and Hyundai/Kia.
Just making hypercars in my life? Sure, it’s a nice thing for a few rich people. But that’s not the point. The point is that you show people what electric cars can do, that the future won’t be boring. And then you use the technology to make it more accessible. Of course, Porsche is much more accessible than us, but it’s still a very expensive car.
But Hyundai, they make reasonably priced cars. So we hope what we’re doing can end up in really exciting electric cars and vehicles that are accessible to a wide audience. We’re also doing that with many other companies that are not our shareholders. Some of the public ones are Aston Martin, Koenigsegg, Renault, Pininfarina. Many others that I can’t talk about. That’s the other part of the business where I really want to go big, providing technologies to them.
Loz: Right. What are the big challenges over the next 12 months?
Surviving, that’s a big one! Not losing too much time through this situation. If you asked me a few weeks ago, I’d have said scaling up the company, going from a small volume manufacturer to a large volume manufacturer of components.
It’s never happened, as far as I know, that somebody started a car company in a garage, and within ten years started supplying other companies with the most, let’s say, crucial parts of their cars. Batteries and powertrains are the most crucial parts of the car.
We’re doing that already for small volumes, we want to do it for big volumes. So scaling up, building a new factory, getting processes in the company under control, that’s a big deal and a lot of money. So we need also to attract additional funding, which is a challenge.
On the hypercar side, it’ll be the first globally homologated electric sportscar, after the Tesla. The first proper, full electric supercar homologated in the US and Europe. That’s a huge challenge to bring that car to the level of quality and so on.
So we have many balls in the air at the same time. Many projects for other OEMs, plus the hypercar and scaling up. And we’re hiring a lot of people, attracting foreign talent into the country, lots of things to do!
Loz: How many people are you responsible for at the moment?
750. That’s the salaries we’ve gotta pay regardless of whether we make any money right now or not.
Loz: Crazy stuff. How old are you?
Loz: 32. Holy shit, man, what a thing to have on your shoulders at 32.
Yeah, but you know, the last ten years have been the same for me. Since we started, it’s been really hard financially. I had to put everything else in my life on the side. I had to focus on this 150%.
It’s funny for me now during the lockdown, people are saying “oh, it’s boring, I don’t know what to do, I’ve seen all the TV series.” I’m flat out, working 14, 16 hours a day. I don’t have enough time to do what I want to do. It’s somehow unfairly distributed.
Loz: Some people are just built different. Do you have a sense for what makes you different in that regard?
I would say first of all, the responsibility I have toward all these people. That’s definitely one thing.
The other thing is curiosity. The kind of car I wanted really didn’t exist. So I had this natural curiosity to see if it could be done.
And people think it’s about the ideas, but I always tell them the idea is absolutely nothing. It’s one percent. Nobody cares about your idea. It’s all about execution. Having the stamina and the patience and the breath to carry it out over ten years.
Loz: Not to mention the courage to get something started, a lot of people never make it past that point.
Yeah, well. I was 20 years old when I started, I don’t know if you saw the BMW I built when I was 20 years old. I wanted to race, and I had a 1984 BMW 3 series, 4 years older than I was. It had an old combustion engine, and after two races, the engine blew up and I decided to combine my two passions of electronics and cars.
Before that, I was the national electronics champion in Croatia. I had two patents at 17 years old, and lots of awards all over the world. So I was good in electronics, I was crazy about cars all my life, and when that engine blew up I decided to build an electric car in my garage. It’s a long story.
Then I got some investors, I met Arianna, who is our head of design, we started to work on our own car. But the investors screwed me, they didn’t pay what they promised to. A royal family from the Middle East.
Then you know, to survive, I had to start working for other car companies. This whole thing kind of started like that. One thing fell into another, and ten years later, here we are. But in business, you’re like a gambler, you keep coming back to the table to try to make up what you lost yesterday. It’s a never-ending story.
Loz: Do you still get a chance to roll up the sleeves? How involved are you at the electronics end?
Oh, very involved. I’m the CEO and CTO. That’s my passion, but unfortunately most of the time I have to deal with Excel spreadsheets and investors and contracts and that kind of stuff. But I’m responsible also for all the technology in our company, and I’m really hands-on there. That’s the most important thing in the end.
Loz: Will you get a chance to take your own car out and go back to racing again?
Well, that green BMW was crashed by one of our employees maybe six years ago. And every year, I make a list for what I want to do in that year, and every year, it’s on that list. But there’s always something more important, we spend the time and the money on wiser things.
But this year, we finally started to do it, so we’re restoring that old BMW. So maybe I’ll use that to go back on the racetrack.
I don’t have a Concept One, because I’m not a 100% shareholder of the company, so if I want to have a car, I have to pay for it like anyone else. Which I can’t do. (laughs) So now with the C_Two, I’m hoping there might be a prototype left over for me!
Loz: (laughs) I hope so too, I feel like you’ve earned it! Do you have a plan B if this all comes crashing down?
Ha! I think I’ll sleep for about six months, to start with! I don’t care, I don’t give a shit to be honest. We’ve done a lot of cool things, a lot of good things, a lot of people have learned a lot, and if it all comes crashing down, it had to be like that. At least I know I did everything I could to make it a success.
But it’s always possible! A few years ago, our chances were probably in the single digit percentages. Now, I’d say our chances are much better. I don’t know. Of course, I get super freaked out if there’s a life-threatening event for the company. But I’m not nervous.
Will it come crashing down after coronavirus, if people don’t want to buy supercars after that? If so, so be it. We’ve done everything we could.
Loz: You’ve proven yourself very resourceful, I’m sure you’ll think of something!
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