Ford Motor stated on Wednesday it is going to invest $500 million in U.S. electric vehicle startup Rivian Automotive LLC, joining Amazon.com Inc in supporting the possible competitor to Silicon Valley’s Tesla Inc.
Ford stated it will use Rivian’s “skateboard” – a chassis that bundles electric motor, batteries, and controls – to make a new vehicle for North America. It did not provide information on what type of vehicle, and where or when it would be constructed.
Michigan-based Rivian, established in 2009, has raised over $1.5 billion from investors. A company spokesman refused to provide a valuation for the company, but investor website Dealroom.com evaluates Rivian’s value at $5 billion to $7 billion.
Tesla’s market is estimated at around $45 billion, while Ford’s market cap is just below $38 billion. In mid-day trade, Ford shares were flat at $9.50, whereas those of Tesla were down a fraction at $263.07.
On Wednesday, Ford CEO Jim Hackett stated the deal with Rivian does not impact Ford’s discussions with Volkswagen about sharing the automaker’s electric vehicle architecture.
“It does not interfere” with Volkswagen, Hackett stated during a conference call on Wednesday. “This is a specific platform that assists us in areas we weren’t considering with others.”
Rivian’s first products, a large pickup truck and a utility vehicle, are set to go into production in 2020 and early 2021, CEO R.J. Scaringe stated. Those two electric vehicles, together with the skateboard that Ford will utilize, will be constructed at Rivian’s plant, a former Mitsubishi factory in Normal, Illinois.
Scaringe stated Rivian and Ford “put this deal together over the last six months.”