This week, electric vehicle maker Rivian is expected to throw its hat in the ring with a major IPO that could affect both the EV landscape and the way the world’s largest online retailer gets its packages to your door.
Rivian, which has raised approximately $11 billion of private capital over the past three-years, is now seeking an enormous valuation of more than $60 billion, according to a SEC filing. Plans include using the RIVN ticker.
Rivian is supported by whom?
Some of its investors are big names. Amazon, an early investor, owns around a fifth of Rivian. The company plans to order 100,000 Rivian-electronic delivery trucks in order to expand its fleet and lower its carbon footprint. T. Rowe Price was another important investor and player in Rivian’s 2020 investment round of $2.5 billion.
Ironically, one of the potential big winners of Rivian’s successful IPO is the 118-year-old automaker Ford, which has a similarly major stake in the company, and plans to work closely with Rivian in the future on EV projects.
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Rivian is exciting for electric vehicle enthusiasts.
Founded in 2009 by CEO R.J. Scaringe, Rivian’s consumer offerings—a pair of pre-production electric vehicles—made a huge splash when they were In 2018They are distinguished by their stylish styling and a variety of premium features, such as an optional camp stove that is integrated between the rear axles and rear passengers seats. These extras are not available on other trucks and SUVs. Its current consumer-facing lineup, the R1T pickup truck and R1S SUV, are built on Rivian’s “skateboard platform,” which grants the company increased flexibility when it comes to creating different types of vehicles, like its electric delivery trucks. The platform, a chassis upon which a car can be built, houses the car’s essential components like electric motors, battery packs, and suspension systems, all neatly packaged below the vehicle body, giving it a lower center of gravity than traditional combustion engine cars.
Rivian’s R1S SUV will be competing with other electric SUVs from companies like Tesla, which produces the Model X SUV and crossover Model Y vehicle. Tesla’s anticipated pickup truck, Cybertruck, might give the R1T pickup truck a run for its money, but the Cybertruck’s large size, divisive form-over-function styling, and continuous delays might give Rivian a fighting chance in the budding EV pickup truck space.
R.J. Scaringe, CEO
Rivian (formerly Mainstream Motors), switched to EV sports cars in the early stages to the luxurious EV utility vehicles that are on display today. According to R.J. Scaringe, R.J. Scaringe is a 36-year old founder. “It became increasingly clear that we weren’t answering a question that the world needs an answer to,” he said of the pivot in a 2020 interview. Scaringe is an MIT graduate and spent most of his youth building vintage cars in Florida. Rivian, he believes, can show electric vehicles to be the future for the automobile industry. Rivian could even take over the old gas-guzzling pickup trucks. Scaringe himself hasn’t done much basking in the spotlight, unlike rival Elon Musk, mainly giving interviews to automotive trade publications.
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Which challenges is Rivian facing?
The company isn’t without its stumbles, and if it fails, Rivian wouldn’t be the first eye-catching EV company to make a splash then disappear. Publicly traded company Faraday Future wowed audiences with its futuristic electric sports cars, and was set to begin production on its FF91 electric sedan, but has yet to produce any vehicles, though the company says it’s on track to produce the sedan in 2022.
Ford’s premium Lincoln brand was developing an all-electric SUV in partnership with Rivian that’s since been cancelled. And while the company’s first consumer R1T truck rolled off the line as recently as September due to pandemic-related delays, the company has burned through nearly a billion dollars this year, and says it will continue to be unprofitable “for the foreseeable future” in its filing. It is possible that the company will have to delay fulfilling its pre-orders by a lack of supply chains, such as semiconductor shortages.
Ford isn’t exactly rolling over and giving the EV market to Rivian, either. Despite saying it would continue to work closely with Rivian, the company’s own EV ambitions might help or harm the partnership. Ford already has more than 150,000 orders for its all-electric vehicle. Ford F-150 LightningIt is using its Ford Mustang Mach-E electric motor to boost the EV-based retrofits and custom cars market.
Companies are also betting on other EV manufacturers when it comes time to replace gas-guzzling cars with their electric equivalents. Hertz purchased 100,000 Tesla Model 3 sedans recently to increase its fleet of rental vehicles. The two companies have yet to determine the timing for the huge order. As for Rivian, the company seems to be banking on Amazon’s commitment for momentum into the stock market.