At a recent investor event, relentlessly humble CEO Elon Musk said that in three years driving a non-Tesla car would be like “owning a horse.” Given its recent major investment in electric vehicle (EV) startup Rivian, Ford aims to make Musk eat his words.
On April 24, the legacy automaker announced plans to provide the innovative EV manufacturer with $500 million in funding. Ford wants to acquire a minority stake in the 10-year-old company to gain access to its battery EV platform.
Rivian has made a splash in the automotive sector due to the high quality of their truck and sport utility vehicles. Notably, the firm’s R1T pickup boasts 400 miles per range and its stylish R1U SUV offers 750 horsepower. The startup’s commitment to quality has already paid tremendous dividends. The firm won Best Truck and Star of the Show plaudits at the 2019 International Auto Show.
All that is to say, Rivian has some pretty impressive horses in its stable.
New Ways of Thinking
Ford’s $500 million cash injection isn’t the only high-profile investment Rivian has received recently. In February, the company secured $700 million in new capital, with e-commerce giant Amazon leading the way. As a result of that funding round, industry analysts pegged the startup’s value as being between $1 billion and $2 billion.
Notably, Rivian has captured the imagination of the automotive market without selling a single car. While the firm hasn’t proven its ability to connect with consumers, it has made some really smart moves so far.
Its unique “skateboard” platform places its vehicle’s drivetrain, battery, suspension, and cooling system below wheel height. Consequently, the corporation’s SUVs don’t have the high center of gravity that makes them such a hazard to drivers and pedestrians.
Rivian’s leadership has also shown remarkable self-discipline. Despite receiving high praise from critics and financial support from multinational conglomerates, it hasn’t rushed its products to market. The firm’s decision to take things slowly will help ensure it doesn’t set up consumer expectations it can’t meet.
The company also turned down a big-money offer from a legacy brand to maintain its autonomy. Earlier this month, Bloomberg reported Rivian declined to form a partnership with General Motors because the deal required exclusivity. Instead, the startup chose to hold on to its autonomy while developing products for one of the world’s biggest automotive brands.
Ford’s Electric Future
Ford’s new deal with Rivian is only one element of its larger commitment to going electric. Last January, the corporation announced plans to spend $11 billion on EV development through 2022. As part of that initiative, the brand hopes to introduce 16 new zero-emission vehicles by 2023.
Thus far, Ford has revealed two of the electric cars it plans to bring to market in the near future. Namely, a Mustang-esque crossover that will be unveiled later this year and an electric version of its popular F-150 truck. The motor company has reportedly decided what kind of vehicle it wants to develop using Rivian’s platform but has yet to publicize that information.
Given the amount of money and talent Ford is throwing at the project, its EV line has a lot of promise. Furthermore, Rivian is poised to do amazing things with its new partner’s incomparable resources and infrastructure.