Ford and Rivian cancel plans to jointly develop an electric vehicle

RJ Scaringe, Rivian founder and CEO, and Ford Govt Chairman Invoice Ford announce a $500 million Ford financial commitment in Rivian.

Source: Ford Motor Co.

DETROIT – Ford Motor and Rivian no lengthier prepare to co-produce an electrical vehicle, the corporations verified Friday.

The two organizations in the beginning introduced advancement of a joint car when the automaker invested $500 million in Rivian in 2019. They later explained it would be for Ford’s luxury Lincoln manufacturer, just before canceling individuals strategies last calendar year. Ford, at the time, mentioned the automakers would however request other alternatives to collaborate with just one yet another.

All those programs also have now been scrapped, according to Ford spokesman Ian Thibodeau. He explained the organization retains ties with Rivian, which include a 12% stake in the begin-up, which at the firm’s IPO past week arrived at a benefit of much more than $10 billion.

“We regard Rivian and have experienced extensive exploratory conversations with them, having said that, both sides have agreed not to go after any sort of joint car or truck enhancement or platform sharing,” Ford reported in an emailed statement.

Rivian, which has a far better marketplace benefit now than Ford, on Friday confirmed termination of plans.

“As Ford has scaled its individual EV system and desire for Rivian autos has developed, we’ve mutually determined to target on our personal projects and deliveries. Our partnership with Ford is an essential element of our journey, and Ford continues to be an trader and ally on our shared route to an electrified foreseeable future,” the corporation said in an emailed statement.

Shares of Rivian have been down by about 2% for the duration of write-up-sector buying and selling right after closing at $128.60 a share, up by 3.7%. Ford’s inventory was unchanged from its closing price tag of $19.39 a share, down by less than 1%.

Ford CEO Jim Farley referenced the automaker’s “developing self-confidence” to “acquire in the electric powered area” as reasoning to conclusion the collaboration.

“When you examine currently with when we at first designed that financial commitment, so considerably has transformed: about our capability, about the brand’s direction in equally cases, and now it is really additional particular to us what we have to do. We want to commit in Rivian — we adore their foreseeable future as a business — but at this stage we’re heading to establish our possess motor vehicles,” he told Automotive News, which very first documented the collaboration was useless.

Farley, who grew to become CEO in October 2020, inherited the Rivian expense and jointly made vehicle from his predecessor, Jim Hackett. Nevertheless, Ford less than Farley ordered $415 million in convertible notes in July from Rivian that grow to be common stock in June 2022.

A wholly owned subsidiary of Ford referred to as Troy Design and style and Producing also has a agreement to supply areas for Rivian’s R1 automobile software, according to community paperwork.