Ford Motor Co, on Wednesday, announced its plan of investing $500 million in the U.S. electric vehicle startup Rivian Automotive LLC, a move with which Ford will be joining Amazon.com Inc in supporting the startup that is potentially be competing with Silicon valley’s Tesla Inc for electric vehicles.
Rivian’s “skateboard”, or a chassis used to mount batteries, controls and electric motors on it, will be used by Ford to build a new electric vehicle for North America, said the company, without providing further details about vehicle type, location or even date for the same.
Since its inception in 2009, the Michigan-based Rivian came on raising more than $1.5 billion from investors, but a spokesman declined to disclose the investors’ valuation of Rivian, which is estimated to be at $5 billion to $7 billion, according to an investor website Dealroom.com, while Ford’s market value is nearly $38 billion whereas Tesla is having a market cap of around $45 billion.
Ford will continue discussing sharing of electric vehicle architecture with German automaker Volkswagen AG and that process will not be affected by the current deal with Rivian, Ford Chief Executive Jim Hackett said on Wednesday.
Investment deal in Rivian does not interfere with the Volkswagen, as its platform is specifically helping Ford in areas that the company is not considering with others, Hackett said during a conference call.
Production of Rivian’s first two products, a utility electric vehicle and a large electric truck, is scheduled to begin in late 2020 and early 2021 and Rivian will be building those vehicles at its plant in Normal, Illinois, and the skateboard for those electric vehicles by Rivian, that Ford is intending using, will also be built there, said Rivian CEO R.J. Scaringe.
Amazon, which had said in February that it would lead a $700 million investment in Rivian, will also partner with Ford for cloud-based transportation services, Amazon said last week.
