Amazon, Rivian Might Finish EV Van Exclusivity

[Stay on top of transportation news: Get TTNews in your inbox.]

Electrical automobile producer Rivian and Amazon are in lively discussions about ending the exclusivity provision of their supply van deal, based on a number of media reviews.

First reported March 13 by the Wall Road Journal, Rivian is making an attempt to take away the exclusivity phrases from its Amazon deal on account of a lower-than-expected order quantity for 2023.

The 2 corporations entered into an settlement in 2019 for Amazon to purchase 100,000 supply vans from Rivian by 2030, offering the Irvine, Calif.-based startup a giant title and steady buyer. However Amazon solely plans to purchase roughly 10,000 EV vans this yr, which is on the low finish of a variety beforehand supplied to Rivian, based on the Journal.

An Amazon spokesperson instructed the Atlanta Journal-Structure that “nothing has modified with our settlement with Rivian.”

“We’ve at all times stated that we wish others to learn from their know-how in the long term as a result of having extra electrical supply autos on the highway is nice for our communities and our planet,” the spokesperson stated.

Rivian officers stated they goal to fabricate 50,000 autos this yr, consisting of an unknown cut up between supply vans, R1T vans and R1S SUVs.

A Rivian spokesperson declined to remark in regards to the reported negotiations.

“We proceed to work carefully collectively (with Amazon) and are navigating a altering financial local weather, much like many corporations,” the spokesperson stated in a press release. “The connection now we have with Amazon is a really constructive one.”

Amazon solely plans to purchase roughly 10,000 Rivian EV vans this yr, which is on the low finish of a variety beforehand supplied to Rivian. (Amazon.com)

Amazon is Rivian’s largest stakeholder and has a vested curiosity within the firm’s development from startup to worthwhile firm. Rivian is staking its long-term future in Georgia, promising to construct a $5 billion EV plant an hour east of Atlanta that may make use of 7,500 employees.

Each Amazon and Rivian have undergone layoffs this yr to chop prices, and Amazon went additional to pause development on its second headquarters — referred to as HQ2 — in Arlington, Va. Different outstanding tech corporations, akin to Meta, Microsoft and Google, have additionally delayed workplace plans and reduce their workforce.

Inflation, provide chain points and fears of an financial slowdown have weighed on all automakers, however upstart EV corporations specifically.

Rivian burned by way of $6.8 billion in 2022 and has watched its inventory drop greater than 90% since its IPO in November 2021. By noon March 13, Rivian’s inventory was lower than $14 a share.

In final month’s name with traders, Rivian officers stated they’ve sufficient money in reserves — about $12 billion — to final by way of 2025, however the firm issued $1.3 billion in bonds final week to boost funds to launch its new R2 crossover at its deliberate Georgia manufacturing facility.

Grading work is at present going down on the two,000-acre web site in southern Morgan and Walton counties. However a number of lawsuits have threatened the mission, which Gov. Brian Kemp’s workplace touts because the second-largest in Georgia historical past.

A authorized problem from residents close to the proposed manufacturing facility prompted a neighborhood choose to strike down some $700 million in property tax cuts — practically half of the $1.5 billion incentive package deal state and native leaders used to woo Rivian to Georgia. The ruling has been appealed. Rivian may have the choice to terminate its settlement with the state in Might if the lawsuit isn’t concluded within the state’s favor.

Two different lawsuits problem the state takeover of the Rivian web site, arguing that it improperly circumvented native zoning codes and allow necessities. The state denies these allegations, calling the lawsuits “frivolous.”

Amazon ranks No. 19 on the Transport Matters High 100 checklist of the most important non-public carriers in North America.