The $500m investment by Ford in electric truck manufacturer Rivian has now become a possibility as the company’s talks with General Motors fell through. It is being said that GM, the Detroit rival, wanted exclusive rights to the technology of the start-up, which might have led to the dissolution of the discussions. CEO of Rivian, RJ Scaringe, said that Rivian’s deal with Ford will allow the former to go forward with plans of developing its own dealer network and brand and may be even sign up more automotive partners, no plans of which have been made yet.
The Rivian investment by Ford is consistent with the 116-year-old car-making company’s own electrification program, said Ford CEO Jim Hackett. The company announced last year that it would make an investment of $11bn for developing battery-based cars such as pure battery-electric models, plug-ins and hybrids. In November, two BEVs- R1S SUV and R1T pickup- were unveiled by Rivian that offers several advantages like lowering center of gravity of a vehicle, enhancing handling and providing more space for cargo and passengers by reducing space occupied by engine compartment. Ford managing to sell even a few automobiles made using Rivian’s technology could work as an advantage for the company, said Stephanie Brinley, who believes that the investment in the startup will bring forth several potentially beneficial areas for Ford. Although specifications about work being done collectively by Rivian and Ford have not been revealed yet by either company, it is according to Hackett going to be a next-generation, all-new battery-electric car.
Rivian is currently also developing automobiles for Amazon, with a separate $700m investment deal announced in February. The Rivian-Ford deal however has a disadvantage, for instance, no vehicles developed using Rivian’s technology has been sold yet. The Ford and Amazon investments, with a combined value of about $1.2bn, show that the startup is moving ahead on the right track.