Watch out Tesla. Ford is investing $500 million in electric vehicle startup Rivian.
On Wednesday morning, the two companies announced that they have formed a strategic partnership,kicked-off by the aforementioned investment. In this newly formed alliance, Rivian will help Ford develop an all-new EV built on Rivian’s battery-electric skateboard platform.
“This strategic partnership marks another key milestone in our drive to accelerate the transition to sustainable mobility, RJ Scaringe, Rivian founder and CEO said in a prepared statement. “Ford has a long-standing commitment to sustainability, with Bill Ford being one of the industry’s earliest advocates, and we are excited to use our technology to get more electric vehicles on the road.”
Rivian is no stranger to receiving big investments. It recently received $700-million from Amazon. Presumably, Amazon will utilize Rivian for its future electric commercial fleet.
But why has Ford thrown its hat (and a good chunk treasure) in with Rivian? Simply, it can quickly utilize Rivian’s platform and battery technology to capitalize on the white-hot truck and SUV market.
Ford has earmarked $11 billion toward the development of future EVs. However, this additional half-a-billion-dollar stake in Rivian gets the blue oval a lot closer to getting new products on the road.
Ford recently revealed that it is developing an all-electric version of its best-selling F-150 pickup along with a Mustang-inspired all-electric crossover, which will be built in Mexico. The latter of which Bill Ford said will “go like hell.”
Likely, Rivian’s skateboard platform won’t be utilized for either of those products, as they’re too far along in their development cycle to make use of Rivian’s tech on such short notice.
Instead, Rivian’s skateboard platform, which includes the electric drive motors and batteries and underlying vehicle chassis in one unit (hence the ‘skateboard’ moniker), will be scaled to accommodate next-generation Ford trucks and SUVs. Imagine, for example, the next generation of Expedition, F-250 Super Duty pickup, or forthcoming Bronco off-road SUV being offered in all-electric.
Heck, Ford could even invent new all-electric truck and SUV models that could ride on the Rivian skateboard. Ford recently axed all of its car models in the U.S. So it could use a few more nameplates to fill out its showrooms.
What does this mean?
This investment has a lot of intriguing implications. Chief among them, if I am reading the tea leaves correctly, is that Ford’s battery-electric technology and platform development was considerably behind that of its competitors. This, despite its planned $11 billion EV bankroll.
General Motors engineers have long believed that Ford was neck and neck with them, in terms of battery cell development. Based upon this move by Ford, I am guessing GM engineers were letting the century-old rivalry between the two companies get to their heads. No automaker a decade into meaningful — or successful — EV development would throw $500 million at an unproven startup if it weren’t getting a bit desperate.
Yes, Rivian’s R1T and R1S truck and SUV models are impressive. So, too, is its patent on battery swapping. That said, Rivian’s vehicles have not yet gone into production. They’ve not sold any. And they’ve not been proven on the streets in the hands of customers. We don’t know how they’ll hold up.
Presumably Ford did its due diligence and reviewed the products themselves and whatever internal testing Rivian has done. Still, though, this move smacks of a carmaker keen to cut the proverbial EV development line.