Ford and Rivian cancel plans to collectively develop an electrical automobile

DETROIT – Ford Motor and Rivian now not plan to co-develop an electrical automobile, the businesses confirmed Friday.

The 2 firms initially introduced growth of a joint automobile when the automaker invested $500 million in Rivian in 2019. They later stated it might be for Ford’s luxurious Lincoln model, earlier than canceling these plans final yr. Ford, on the time, stated the automakers would nonetheless search different alternatives to collaborate with each other.

These plans even have now been scrapped, based on Ford spokesman Ian Thibodeau. He stated the corporate retains ties with Rivian, together with a 12% stake within the start-up, which on the firm’s IPO final week reached a worth of greater than $10 billion.

“We respect Rivian and have had in depth exploratory discussions with them, nevertheless, each side have agreed to not pursue any sort of joint automobile growth or platform sharing,” Ford stated in an emailed assertion.

Rivian, which has a far better market worth now than Ford, on Friday confirmed termination of plans.

“As Ford has scaled its personal EV technique and demand for Rivian autos has grown, we have mutually determined to concentrate on our personal initiatives and deliveries. Our relationship with Ford is a crucial a part of our journey, and Ford stays an investor and ally on our shared path to an electrified future,” the corporate stated in an emailed assertion.

Shares of Rivian have been down by about 2% throughout post-market buying and selling after closing at $128.60 a share, up by 3.7%. Ford’s inventory was unchanged from its closing worth of $19.39 a share, down by lower than 1%.

Ford CEO Jim Farley referenced the automaker’s “rising confidence” to “win within the electrical house” as reasoning to finish the collaboration.

“If you examine in the present day with once we initially made that funding, a lot has modified: about our skill, in regards to the model’s path in each instances, and now it is extra sure to us what we now have to do. We wish to spend money on Rivian — we love their future as an organization — however at this level we’ll develop our personal autos,” he informed Automotive Information, which first reported the collaboration was useless.

Farley, who turned CEO in October 2020, inherited the Rivian funding and collectively developed automobile from his predecessor, Jim Hackett. Nonetheless, Ford beneath Farley bought $415 million in convertible notes in July from Rivian that turn out to be frequent inventory in June 2022.

An entirely owned subsidiary of Ford referred to as Troy Design and Manufacturing additionally has a contract to produce components for Rivian’s R1 automobile program, based on public paperwork.