Amazon-Backed Rivian Spurned GM With Plans to Build for Others
(Bloomberg) -- It’s becoming clearer why electric truck-making startup Rivian Automotive Inc. spurned the chance to form a partnership with General Motors Co.: The company appears to be doing just fine on its own.
With a $700 million funding round led by Amazon.com Inc. just completed, Rivian has six vehicles planned by 2025 -- and that’s just the models that will be sold under the Rivian brand. The startup also will be making several models for other companies, founder R.J. Scaringe said in an interview at the New York auto show. One of them is related to the Amazon deal, but not necessarily a vehicle, Scaringe said, declining to give more detail.
Scaringe’s grand plan helps explain why talks that would have given GM a stake fell apart. With both consumers and businesses showing interest, Rivian is rebuffing a deal that may have required a level of exclusivity that would have kept it from building vehicles for others.
“In general, my reason for starting Rivian was to do big things without anything preventing us from doing that,” Scaringe said, while declining to discuss talks with GM specifically.
GM and Rivian came close to a deal that could have benefited both companies. GM would have been able to lend engineering and manufacturing expertise. In return, Rivian may have helped the largest U.S. automaker get an electric pickup to market quicker.
With those talks in the past, Scaringe has big ambitions. He said that by 2025, Rivian’s plant -- a former Mitsubishi Motors Corp. factory in Normal, Illinois, bought for just $13 million --will make the half-dozen different pickups and sport utility vehicles of varying sizes.
None of the vehicles Rivian has in the pipeline will be a sedan, Scaringe said. All of them will be larger pickup and SUVs because those vehicles are popular and burn the most fuel.
Rivian’s electric-vehicle platform, which Scaringe prefers to refer to as a “skateboard,” is a big part of his vision to deliver returns to those who’ve backed him. In addition to retailing trucks and SUVs, he’s open to selling the technology to others for a myriad of applications, such as stationary batteries.
The company, headquartered in Plymouth, Michigan, is drawing significant interest from consumers. As Tesla Inc. did with the Model 3 sedan, Rivian has been taking $1,000 deposits for the R1T pickup and R1S SUV that will go on sale starting in the fall of 2020.
Rivian invited all depositors to check out the company’s vehicles at an event Tuesday at Classic Car Club Manhattan. While Scaringe said he figured he would draw a limited audience from the New York Metro area, about 1,200 people showed up, with some visiting from as far away as Hawaii.
“It’s fairly routine for boutique vehicles to get a lot of interest and take deposits,” said Eric Noble, president of The CarLab, a consulting firm in Orange, California. “But for mass-market vehicles? No.”
Rivian has tens of thousands of pre-orders, Scaringe said, though he declined to say how many. He’s already looking for ways to expand production in Normal. A little more than half the depositors want the pickup truck.
“That’s pretty awesome that they got that much interest," said Rebecca Lindland, a longtime auto-industry analyst and founder of the car-review website RebeccaDrives.com. “It’s pretty easy to thrown down $1,000 for a car, but that is pretty impressive.”
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