American start-up Rivian, which manufactures electric trucks and SUVs, got a mega funding of $2.5 billion from a clutch of investors just before it starts production in 2021.
The recent fresh round of funding adds to a total of $10.5 billion of such funds received by this Amazon-backed company.
Amazon's Climate Pledge Fund, Ford, D1 Capital Partners, T. Rowe Price were the key investors in this round. Soros Fund, Fidelity, Blackrock and Abdul Latif Jameel Co. (Saudi Arabia) are some of the strategic investors in Rivian.
Rivian has operations in California, Michigan and Illinois; and competes with Tesla in certain electric vehicle categories.
Rivian was valued at $27.6 billion after T. Rowe Price invested $2.65 bn in January 2021.
Rivian CEO RJ Scaringe said that the fresh funds will assist the start-up in its next phase of growth entailing new vehicle launches; widening of domestic manufacturing facility and its operations; and its international expansion plans.
Rivian is looking at another assembly facility for producing electric vehicles and batteries (referred to as project Tera) in the US (its second) to augment its facility in Normal (Illinois), as per reports. The 50-Gwh (gigawatts per hour) battery cell production unit will be built and scaled up over a period of time. The project Tera land of around 8.71 crore sq. ft. will be conditioned to meet net-zero emission targets.
Rivian intends to produce up to 40,000 electric vehicles in the first full year and subsequently scale up to about 300,000 units per year, as per Bloomberg.
Rivian is also seeking to list on the US stock exchanges at an anticipated valuation of around $50 billion and raise capital through an initial public offering (IPO).
The company has already intimated customers that they could face delays in the deliveries of their R1T electric pick-ups (priced at $73,000 now and $67,500 for pre-ordered for delivery in 2022) and R1S electric SUVs (priced at $75,500 now and $70,000 for pre-ordered for delivery in 2022) due to global shortages of chips. Rivian expects to deliver the first R1Ts starting September.
Amazon has reportedly ordered 1 lakh electric vehicles from Rivian.
In the electric SUV business, Rivian competes with Elon Musk’sTesla Inc. Rivian's R1T, which claims to be more innovative yet traditional in its styling, is pitted against Tesla's Cybertruck (which Tesla claims is a futuristic military styled utility ‘truck’ with sports car performance).
In the US, Tesla, Foxconn (Taiwan) and start-ups such as Lucid and Canoo are adding to their existing electric vehicle facility while others such as General Motors and Ford are restyling their existing ones.