(Reuters) – Amazon.com Inc. and General Motors Co are in talks to invest in Rivian Automotive LLC in a deal that would make the value of the US electric pick-up truck manufacturer at between $1 billion and $2 billion, people familiar with the matter said on Tuesday.
FILE PHOTO: The logo of Amazon is seen in the company’s logistics centre in Boves, France, 19 January 2019. REUTERS/Pascal Rossignol/File Photo
The deal would give Amazon and GM non-controlling interests in Rivian, the sources said. It would be a major boost for the Plymouth, Michigan-based startup, which aims to be the first car manufacturer in the US. the consumer market with an electric pick-up.
If the negotiations conclude successfully, a deal could be announced as early as this month, the sources said, the question is not to be identified because the matter is confidential. There is always a chance that the deal talks, the sources cautioned.
“We admire Rivian contribution to a future of zero emissions and an electric future,” GM said in a statement via e-mail, refusing to specifically comment on one conversations with Rivian.
Rivian refused to comment. Amazon did not respond to requests for comment.
The Rivian deal would come as the much larger electric vehicle industry rival, Tesla Inc., the struggle for the stabilisation of the production and delivering consistent profits as rolls the flagship Model, the 3 sedan.
Tesla CEO Elon Musk told investors last August that an electric pick-up “probably my personal favorite for the following product” of the company, even though he has spoken only in general about a possible launch, saying that it would happen “immediately after” Tesla’s Model Y, which the company has chosen to start production in 2020.
Rivian plan is to start with the sale of his R1T, the pick-up it debuted in November, in the autumn of 2020. The company was founded in 2009 by CEO R. J. Scaringe.
Scaringe has described the Rivian car’s platform-as-a “skateboard” that packages the drive, battery, suspension, brakes, and cooling system all below wheel height to provide more storage space and greater stability due to a lower centre of gravity.
He also said that the company plans to cooperate with external companies for the development of advanced self-driving technology, instead of trying to do this on his own.
Major car manufacturers, including GM, have not jumped into the market for electric pickups so far. GM CEO Mary Barra has said that it is a “little bit” to think about the development of all-electric pickups.
The No. 1 U.S. automaker is counting on profits from the sales of the traditional large pick-up trucks and suv’s in North America, fund for the electrification push. GM said in November last year was a doubling of resources for the development of electric and self-driving vehicles, as part of a major restructuring that included ending production at five North American plants.
GM last month announced a strategy for its luxury Cadillac the advantage of electric car brand, which would be the first car to be built at the Detroit automaker “BEV3” platform to challenge Tesla. GM has said that one of the first fully electric Cadillac models with the new platform would be on the market around 2022.
Amazon has also invested in self-driving car startup Aurora Innovation Inc, in a $530 million funding round announced last week. The world’s largest online retailer has increased steadily in the logistics footprint, the building of warehouses all over the world and inking offers with Mercedes as cargo airlines to help with the delivery.
Rivian the existing donors are Saudi car distributor Abdul Latif Jameel Co (ALJ), Sumitomo Corp of America and Standard Chartered Bank. ALJ has agreed to provide nearly $500 million in funding, Sumitomo invested an unknown sum, and Standard Chartered, provided that the debt financing of $200 million.
Reporting by Harry Brumpton in New York and Stephen Nellis in San Francisco; Additional reporting by Ben Klayman in Detroit and Jeffrey Dastin in San Francisco; editing by Bill Rigby