Ford and Rivian cancel plans to collectively develop an electrical automobile
Supply: Ford Motor Co.
The 2 firms initially introduced improvement of a joint automobile when the automaker invested $500 million in Rivian in 2019. They later mentioned it will be for Ford’s luxurious Lincoln model, earlier than canceling these plans final 12 months. Ford, on the time, mentioned the automakers would nonetheless search different alternatives to collaborate with each other.
These plans even have now been scrapped, in keeping with Ford spokesman Ian Thibodeau. He mentioned the corporate retains ties with Rivian, together with a 12% stake within the start-up, which on the firm’s IPO final week reached a price of greater than $10 billion.
Rivian, which has a far higher market worth now than Ford, on Friday confirmed termination of plans.
“As Ford has scaled its personal EV technique and demand for Rivian autos has grown, we have mutually determined to deal with our personal initiatives and deliveries. Our relationship with Ford is a crucial a part of our journey, and Ford stays an investor and ally on our shared path to an electrified future,” the corporate mentioned in an emailed assertion.
Shares of Rivian had been down by about 2% throughout post-market buying and selling after closing at $128.60 a share, up by 3.7%. Ford’s inventory was unchanged from its closing worth of $19.39 a share, down by lower than 1%.
Ford CEO Jim Farley referenced the automaker’s “rising confidence” to “win within the electrical area” as reasoning to finish the collaboration.
“If you examine at present with after we initially made that funding, a lot has modified: about our means, in regards to the model’s path in each instances, and now it is extra sure to us what we’ve to do. We wish to spend money on Rivian — we love their future as an organization — however at this level we will develop our personal autos,” he advised Automotive Information, which first reported the collaboration was lifeless.
Farley, who turned CEO in October 2020, inherited the Rivian funding and collectively developed automobile from his predecessor, Jim Hackett. Nevertheless, Ford below Farley bought $415 million in convertible notes in July from Rivian that turn into widespread inventory in June 2022.
A completely owned subsidiary of Ford referred to as Troy Design and Manufacturing additionally has a contract to produce components for Rivian’s R1 automobile program, in keeping with public paperwork.