Rivian has not even begun building pre-production versions of its R1T electric truck and R1S electric SUV, but it raised almost $3 billion in 2019, capped by its most recent funding round that added $1.3 billion to the company’s coffers. This latest round was led by T. Rowe Price, which is also a major investor in Tesla.
According to CNN Business, Amazon and Ford participated in the latest funding round even though both have already made significant investments in the company previously. Ford made a $500 million investment in Rivian earlier this year and Amazon ponied up $700 million this year. Amazon expects Rivian to supply it with 103,000 all-electric delivery trucks someday in the near future.
“This investment demonstrates confidence in our team, products, technology and strategy — we are extremely excited to have the support from such strong shareholders,” Rivian founder and CEO RJ Scaringe said in a statement this week.
How does a company with no products to sell attract such massive investments? According to MIT Technology Review, the secret sauce is Rivian’s skateboard, which the company has been quietly developing for the past 10 years. The company says the skateboard packages the battery, suspension, braking system, and mechanical components together in a platform that is all below the height of the wheels. The design lowers the center of gravity of its vehicles, which improves handling and increases storage space.
Rivian can then easily sell the platform to other manufacturers, saving the startup hundreds of millions in development costs. That could accelerate the transition to building electric vehicles for existing automakers. “We can leverage our skateboard technology in its entirety or sell pieces of it, such as the battery pack,” R.J. Scaringe, Rivian’s founder and chief executive, told Forbes recently in an interview.
Volkswagen expects to do much the same thing with its MEB electric car platform, which Ford has already said will serve as the basis for one or more electric vehicles in the future. Tesla, on the other hand, has shown little interest at this stage in selling powertrains to other companies (it did so in the past to Toyota and Daimler).
One other market advantage Rivian has that probably helps at this stage is that is has decided to build the big, hulking vehicles Americans crave. Many customers who turn up their noses at sedans and soft-sided cute utes are gaga over the prospect of driving a large electric vehicle like the R1T or R1S. Both are said to offer 400 miles of range, a load rating of 1,800 pounds, and the ability to tow 11,000 pounds. Those numbers fall in between the specs for the low-end and the top-tier Tesla Cybertruck — but the styling is a bit different. Prices will start at $69,000, the company says, considerably higher than the estimated base price of the Cybertruck.
Rivian expects to begin deliveries late next year, and then the world will be able to judge the merits of the Rivian twins. But the latest funding round suggests many in the investment community have already made up their minds about how competitive Rivian will be in the electric truck wars to come.