Amazon is leading a $ 700 million investment in the startup of a Rivian electric van



(Reuters) – Amazon.com announced Friday that it would lead a $ 700 million investment in US-based electric pickup truck start-up Rivian Automotive, the e-commerce giant's biggest gamble on technologies that could reshape the auto industry.

The agreement represents a major recognition of Rivian's electric vehicle technology by the world's largest online retailer. Amazon hopes that Rivian will assist in the development of delivery vehicles that will strengthen its logistics network, according to a person familiar with the case who would have asked not to be identified during the debate on the confidentiality strategy.

Reuters reported Tuesday that Amazon and General Motors were in talks to invest in Rivian. The negotiations between GM and Rivian regarding an investment are continuing and any agreement would be announced at a later date, announced Friday people close to these discussions.

Rivian could be valued between $ 3 billion and $ 4 billion, according to one of the sources.

The Rivian case comes as its much larger rival in electric car manufacturing, Tesla, struggles to stabilize production and generate substantial profits as its Model 3 sedan increases. pricing to give it a mass market appeal.

Tesla CEO Elon Musk told investors in August that an electric van was "probably my favorite for the next product" of the company. But he spoke only generally about a potential launch, saying it would happen "just after" Tesla's Y model, which the company had planned to launch in production in 2020.

Rivian unveiled its R1T electric pickup and R1S SUV for the first time at the Los Angeles Auto Show last November. But the company had stung the interest of Amazon earlier, according to one of the sources.

The CEO of Amazon, Jeff Bezos, personally contacted Rivian's founder and CEO, R.J. Scaringe last summer to express his interest in an investment, the source said. Since then, Amazon has intensified its investments in the automotive sector by participating in the $ 530 million fundraising announced last week in Aurora Innovation, a start-up specializing in the automotive industry.

Amazon is looking for offers to quickly move parcels to customers, regardless of peak consumer demand or lack of delivery personnel. Last year, Mercedes declared that Amazon had become the largest customer of its Sprinter vans, supplying 20,000 vehicles to subcontractors.

Amazon has also sought to win customers inside the car. Working with BMW AG, Ford Motor, and Toyota Motor, Amazon has enabled the installation of Alexa's virtual assistant in new models so that drivers can dictate what music they want to hear and what tasks they want to perform, hands-free.

Rivian aspires to be the first to produce a consumer electric pickup. He intends to start selling his R1T by the end of 2020.

Scaringe described the Rivian vehicle platform as a skateboard that encapsulates drive units, battery pack, suspension system, brakes and cooling system, all below wheel height to allow more storage and stability thanks to a lower center of gravity.

He also said that the company plans to partner with outside companies to develop advanced autonomous driving technology, rather than trying to do it alone.

Existing Rivian lenders include Saudi auto distributor Abdul Latif Jameel, Sumitomo of Americas and Standard Chartered Bank.

Some existing shareholders took part in the round of financing, said Rivian, stressing that the group would remain an independent company.

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