Rivian has been hogging headlines. The maker of electric vehicles has launched the 2022 Rivian R1T electric pickup truck and will soon add production of the 2022 Rivian R1S electric three-row SUV.
The startup also has a contract to make 100,000 electric delivery vans for Amazon Prime and will expand to fill fleet orders for others.
And Rivian went public on Nov. 10, 2021. The stock opened at $106.75, above the initial public offering price of $78 per share, rose as high as $119 and closed at $100.73. That gave Rivian an opening day market value just shy of $100 billion, higher than General Motors or Ford which have revenue in the billions and sales in the millions. Conversely, Rivian hopes to deliver its first 1,000 vehicles by the end of 2021. It has not yet generated revenue, as it continues to use its capital to bring its first vehicles to market in the former Mitsubishi plant it bought, expanded, and retooled in Normal, Illinois, in 2017.
Rivian Humble Beginnings
As for who owns it—Rivian owns Rivian. It was founded in 2009 by engineer RJ Scaringe, initially as Mainstream Motors, then briefly as Avera Automotive, based in Scaringe’s home state of Florida.
The company, renamed Rivian, started with a small crew and an original plan to build a mid-engine hybrid sports car. That idea was scrapped and eventually the small company saw a future in electric adventure-oriented trucks and SUVs.
It is now a publicly traded company, but it had big name backers to get it to where it is today, notably Ford and Amazon, both of which had a vested interest.
Amazon worked closely with Rivian to design the delivery vans being assembled at the Rivian plant in Normal. Vans were running around on city streets as part of a pilot program to work out bugs ahead of filling the order with production vans that will go into service delivering packages. Amazon owns about 20 percent of Rivian.
Ford’s vested interest included initial plans to have Rivian make an electric SUV for the Lincoln brand. The luxury SUV would have used Rivian’s skateboard EV chassis with a “top hat” designed by Lincoln. It was also to be built by Rivian at the Normal plant.
But in April 2020, Ford announced that it had changed plans and would build its own Lincoln EV, using its new electric vehicle platform, and assembled at a Ford plant. Ford CEO Jim Farley has said the two automakers continue to work together, with mutual admiration and respect and a strategic vision that will play out over many years. Ford is also supplying some components, engineering and tooling to Rivian. A Ford subsidiary did the prototype bodies-in-white for the Rivian and Amazon pre-production vehicles while Rivian was still tooling up its own body shop in Normal.
At the very least, Rivian is proving to be a good investment—Ford’s stake in Rivian is about 13 percent, and the roughly $1.2 billion invested was worth about $9 billion when trading began. Ford also had a representative on the Rivian board of directors but that ended prior to the company going public.
Rivian Investors Keep Growing
Another investor is Cox Enterprises which is also collaborating with Rivian on digital retailing, service and logistics. Rivian is following Tesla’s model of direct sales instead of traditional dealerships.
Global asset firm T. Rowe Price is also a large investor and other financial companies that invested prior to the IPO include Fidelity Management and Research Company, D1 Capital Partners, Third Point, Dragoneer Investment Group, Franklin Templeton, Blackstone, and Coatue. Rivian has piqued the interest of financial investors speculating it could be the next Tesla, which was an EV startup as well and is now the most valuable automaker in the world—its market value hit $1 trillion in October 2021 for the first time.
Rivian is based in Irvine, California, but retains the Engineering and Design Center in Plymouth, Michigan, which at one point also served as headquarters until the decision was made to relocate the HQ to Irvine. There are also offices elsewhere in California, as well as Canada and the U.K.
Time to Grow Products and Production
Scaringe plans to use the money raised in the IPO to expand his Rivian lineup to include more vehicles built on the R1 platform, a smaller R2 family of vehicles, Rivian-badged adventure or overland vans, as well as commercial vans for customers in addition to Amazon.
The CEO also wants a second plant to meet forecasted demand. And he wants Rivian to make battery systems and drivetrains in-house. Rivian is also building a charging network that includes off-road locations to plug in.
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