Electric truck maker Rivian secures $ 2.5 billion in new funding

  • Electric Truck and SUV Maker Rivian Secured $ 2.5 Billion in New Funding
  • Analysts: “The days of Tesla’s virtually unchallenged dominance may be numbered. “
  • Amazon ordered 100,000 Rivian electric delivery vans

Rivian has secured $ 2.5 billion in new funding, the electric truck maker announced Friday (July 10).

T. Rowe Price Associates, a former investor, led the investment cycle, with participation from Soros Fund Management LLC, Coatue, Fidelity Management and Research Company and Baron Capital Group. Existing shareholders Amazon and BlackRock also participated.

Rivian is the less sexy but increasingly sexier member of a triumvirate of electric vehicle companies that includes Nikola Motor Co., whose shares jumped when it went public last month, and Tesla, recently ranked as the most valuable transport company in the world.

Rising in the rankings, Rivian has been in tears since last fall, when Amazon (NASDAQ: AMZN) ordered 100,000 electric delivery vans from the Michigan-based startup.

Prior to that date, Rivian had positioned itself as an adventure vehicle builder, focused on an electric pickup truck, the Rivian R1T, and an electric SUV, the Rivian R1S.

In total, Rivian completed four rounds of funding in 2019, including a $ 1.3 billion investment led by funds and accounts advised by T. Rowe Price Associates.

Despite production delays linked to the coronavirus pandemic, mainstream vehicles are expected to launch early next year. Around 10,000 Amazon delivery vans will join the electronics giant’s fleet by 2022.

Race to bring electric truck and SUV to market

Rivian plans to produce the vans and pickup trucks at a former Mitsubishi Motors plant in Normal, Ill., Which it acquired in 2017. The plant gives Rivian another advantage over its competitors to market electric trucks and SUVs. Tesla, for its part, is still looking for a manufacturing facility for its Cybertruck.

“The days of Tesla’s virtually unchallenged dominance may be numbered,” Morgan Stanley analysts said in a research note released today. Rivian has now raised around $ 6 billion in equity, compared to a total of around $ 8 billion for Tesla’s equity fundraising, a figure based on Morgan Stanley calculations, analysts wrote.

Overall, Rivian’s cash injection reinforces the gold rush trend towards vehicle electrification, Pitchbook analyst Asad Hussain said in an emailed statement.

“Allaying fears that COVID-19 may delay investments in electric vehicle technology, investments in electric vehicle technology remain significant,” he said.

“Reflecting the significant rise in the stock prices of electric vehicle companies such as Tesla and Nikola,” startups such as Rivian and QuantumScape continue to raise outsized funding rounds, according to Hussain.

In the first half of 2020, $ 968 million in venture capital was invested in electric vehicle startups, according to Pitchbook.

Related stories:

Amazon announces purchase of 100,000 electric vehicle delivery vehicles from Rivian – largest order ever

Rivian closes $ 1.3 billion funding round

Click here for more FreightWaves articles by Linda Baker.

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