Rivian Scraps Plan to Make Electrical Vans in Europe With Mercedes
A Rivian Waypoint stage 2 electrical car charger in Yosemite Nationwide Park, Calif. (Bing Guan/Bloomberg Information)
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Rivian Automotive Inc. is shelving plans to collectively construct electrical vans in Europe with Mercedes-Benz AG, aborting a deal signed simply three months in the past to share prices and rapidly scale up manufacturing.
Rivian will now not pursue the memorandum of understanding signed with the German automaker in September to put money into and collectively function an current Mercedes plant, the U.S. firm mentioned in a press release Dec. 12. Mercedes mentioned individually that the manufacturing facility it was going to share with Rivian in Jawor, Poland, will produce medium and enormous vans that can hit the market in 2025.
“At this cut-off date, we imagine specializing in our shopper enterprise, in addition to our current business enterprise, characterize essentially the most engaging near-term alternatives to maximise worth for Rivian,” CEO RJ Scaringe mentioned in Rivian’s assertion.
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Strolling away from an settlement that might have eased the trail to getting into a brand new market represents one other setback to Rivian’s ambitions to problem Tesla Inc. for electrical car management. After staging one of many largest U.S. preliminary public choices ever simply over a yr in the past, the corporate flagged that its manufacturing facility would solely produce half the variety of automobiles it has capability to construct this yr, as a result of provide chain points. It’s additionally needed to minimize jobs and recall virtually all of the EVs it delivered to clients.
Rivian shares fell as a lot as 5.5% earlier than the beginning of normal buying and selling Dec. 12 in New York. Mercedes traded down 0.6% as of 11:35 a.m. in Frankfurt.
Mercedes noticed partnering with Rivian as an opportunity to share know-how and funding with an upstart because it electrifies its van lineup. Whereas it’ll nonetheless enlarge its Jawor plant that’s been making combustion engines since 2019 and batteries since final yr, additional growth to make room for Rivian is now on maintain.
“Our collaboration with the Rivian crew has been based mostly on a typical engineering ardour and a powerful spirit of partnership,” Mathias Geisen, the pinnacle of Mercedes-Benz Vans, mentioned in a press release. “That’s why I respect and perceive the choice of Rivian to prioritize the supply of their shopper enterprise and current business enterprise within the near-term.”
Rivian makes two fashions for shoppers — the R1T pickup and R1S sport utility car — and has a deal to construct 100,000 electrical supply vans for Amazon.com Inc., one in every of its largest shareholders. Its lone manufacturing facility is in Regular, Unwell., and it’s planning to spend $5 billion on a brand new plant close to Atlanta.
A brand new Amazon supply van designed by Rivian on show throughout the Delivering the Future occasion on the Amazon Robotics Innovation Hub in Westborough, Mass. in November (M. Scott Brauer/Bloomberg Information)
This isn’t the primary time Rivian has had a product and manufacturing partnership with a longtime carmaker crumble. Plans to construct an electrical car with Ford Motor Co. — one in every of Rivian’s large early monetary backers — have been deserted in November 2021, shortly after the IPO. Ford pared again its funding in Rivian within the following months.
When the preliminary cope with Mercedes was first introduced in September, it despatched Rivian shares up 11%, their largest achieve in 4 months. The EV maker’s inventory is now down 74% this yr via Dec. 9’s shut.
The door to future cooperation between the businesses stays open, the 2 mentioned.
“We share the identical purpose as Mercedes-Benz Vans, to assist the world transition to electrical automobiles, and we sit up for exploring alternatives with them at a extra applicable time for Rivian,” Scaringe mentioned.
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