It is time for the quintessential American vehicle to finally go electric, and no, I’m not talking about another Tesla. Ford has announced a $500 million equity investment into electric truck and SUV builder Rivian. Ford hopes to use the injection of cash to get a foot in the door for the development of a line of electric trucks and SUVs built on top of Rivian’s electric vehicle skateboard platform.
“This strategic partnership marks another key milestone in our drive to accelerate the transition to sustainable mobility,” said Rivian’s founder and CEO RJ Scaringe. “Ford has a long-standing commitment to sustainability, with Bill Ford being one of the industry’s earliest advocates, and we are excited to use our technology to get more electric vehicles on the road.”
The announcement comes on the heels of significant investment interest in Rivian, resulting in an impressive $700 million funding round led by Amazon that hinted at a revolution in electrified delivery vehicles and beyond for the retail titan. A would-be investment in Rivian from General Motors around the same time fell through in the later phases, as Rivian reportedly walked away from the talks earlier this month. Rivian CEO RJ Scaringe told Fortune that Rivian preferred to keep its options open, hinting that GM was perhaps seeking an exclusive arrangement with Rivian. Or maybe Rivian just knew Ford was providing a better offer and was being nice.
It is clear now that Ford was able to not only work through any contractual issues with its investment, but was also able to swallow its pride enough to invest a chunk of change into an up and coming electric truck company. Trucks are Ford’s bread and butter, which makes the Rivian deal that much more interesting. It is a clear sign that Ford believes that the future is electric and it hopes to use Rivian’s mastery of the space to build its next generation of oversized, electrified SUVs and trucks.
“We are excited to invest in and partner with Rivian,” said Bill Ford, Ford’s executive chairman. “I have gotten to know and respect RJ, and we share a common goal to create a sustainable future for our industry through innovation.”
The three top selling vehicles in the United States are trucks, amounting to more than 2 million vehicles sold per year, but even with such a dedicated base, they have not seen much love in the world of vehicle electrification. That’s largely due to electric vehicles having an image as eco-mobiles that has created a rift between internal combustion fired vehicles and electric vehicles. The falling prices of lithium-ion batteries paired with the mind-blowing performance of electric vehicles have made electric vehicles attractive options in the passenger vehicle segment and they are now primed to tackle middle-America’s darling trucks and SUVs.
Rivian’s R1T electric truck and the R1S sport utility vehicle are geared towards higher-end luxury consumers, much like Ford’s Lincoln lineup of vehicles, leaving plenty of room for an electric work truck for the masses branded with Ford’s iconic blue oval.
With Tesla expected to announce its electric truck later this year for production in 2020, this might come as a disappointment to all the Tesla fans out there, but that could not be farther from the truth. Tesla almost singlehandedly created the electric vehicle revolution in western markets and has become all but synonymous with electric vehicles in those markets as a result. The reality, though, is that Tesla was not started to make billions or even trillions of dollars for shareholders, evil villains or that crazy Musk guy.
Tesla was founded to accelerate the adoption of electric vehicles and the sustainable energy that will power them. Said another way, this giant investment from the company that sells more trucks in the United States than anyone else is just one more milestone along the way towards cleaner, more sustainable transportation that also happens to be faster, quieter, less bumpy, and let’s be honest, more fun, than the vehicles they are replacing. It’s worth celebrating by everyone and great news for the cleantech world and beyond.