In a surprising move, Ford Motors has announced that it has dropped the plan to develop an electric vehicle with startup Rivian. This is despite the fact that Ford invested USD 500 million in the EV startup. These companies had then announced their plans to develop an EV. Later, the companies said that the vehicle developed by them would be for the luxury Lincoln brand of Ford. It was likely to be an SUV. However, that plan was canceled and Ford, at the time, said that it would continue to seek other opportunities where it can collaborate with Rivian. The companies then announced their plan to develop a joint vehicle. However, those plans have been dropped now. According to Ford spokesman Ian Thibodeau, the company would still maintain ties with Rivian, which has now gone public and reached a value of over USD 10 billion. Ford owns a 12 percent stake in the startup. “We have a lot of respect for the EV maker Rivian. Ford even had a very extensive exploratory discussion with Rivian. However, both sides have now mutually decided to not go ahead with any kind of joint vehicle development or platform sharing,” Ford said in a statement. The development has been confirmed by Rivian, which currently enjoys greater market value than Ford.
“Ford is extensively working on its own electric vehicle strategy. At the same time, Rivian vehicles have grown manifold. This is why we have mutually agreed to focus on our own projects and deliveries. This is important to mention that our relationship with Ford has been a very crucial part of our journey. For will continue to be an investor and ally. We share a common of an electrified future,” Rivian said in a statement. After the announcement, shares of Rivian saw a dip of around 2 percent during post-market trading. Ford continues to focus on the development of electric vehicles. It has even manufactured F-150 Lightning and Mustang Mach-E. There are several other electric vehicles of Ford that are in different stages of development. However, it is important to mention that, unlike other automakers, Ford of North America is yet to make any commitment related to an all-electric vehicle future. This is despite the fact that its European division has already announced that they would be going all-electric in the future. General Motors and some automakers have also announced similar things. Several big carmakers are eyeing to add electric vehicles to their lineup. Some of them are even planning to go fully electric by the end of this decade.
Ford CEO Jim Farley had praised Rivian saying it is the “right company with the right strategy.” However, Farley had referenced the growing prominence of the startup in the electric space as the reason behind putting an end to this collaboration. “A lot of things have changed when we compare today’s time with when we had initially invested in Rivian. Both our ability and the direction in which the brand is moving ahead have changed. Also, we are now more certain about what we have to do in the near future. We love the future of Rivian as a company and we still want to invest in the company. But our focus at this point is to develop our own vehicles,” he was quoted as saying. Farley was appointed chief executive officer of the company in October last year. He inherited investment in Rivian and the plan to jointly develop a vehicle from his predecessor Jim Hackett. However, it was under Farley’s leadership when Ford purchased USD 415 million in convertible notes in July from the EV startup. They will become the common stock in June next year. It is pertinent to mention that Troy Design and Manufacturing has a contract with Rivian under which it will supply parts for its R1 vehicle program. Troy is a wholly-owned subsidiary of Ford.