Rivian Valued Over US$100 billion; Will it Dethrone Tesla?By Antonio Gozain | Fri, 11/12/2021 - 11:28
EV automaker Rivian raised US$11.9 billion in its public debut on Wednesday, the largest haul for an IPO on a US exchange since 2014. The Amazon-backed company has only manufactured a few hundreds of vehicles but it is already worth over US$100 billion and is ready to compete in the blooming EV market.
Only two days after the Nasdaq debut at US$78, shares surged as much as 57.68 percent, reflecting investors’ interest on the emerging EV market. Although everything looks positive for Rivian, direct competitor Elon Musk, CEO, Tesla, remains skeptical.
"There have been hundreds of automotive startups, both electric and combustion, but Tesla is (the) only American carmaker to reach high volume production and positive cash flow in past 100 years. I hope they (Rivian) are able to achieve high production and breakeven cash flow. That is the true test," said Musk in a tweet.
Based in Irvine, California, Rivian has its manufacturing facilities in Normal, Illinois, besides other strategic locations across the US, Vancouver and the UK. The company was founded in 2009 by Robert Scaringe, its current CEO. After several delays due to the pandemic, logistics constraints and semiconductor shortages, Rivian delivered its first vehicles in October 2021. Currently, the automaker offers two vehicles: R1T, the first-ever fully-electric pick-up, which starts at US$67,500 and R1S, a fully-electric SUV, starting at US$70,000, according to Rivian’s webpage.
Tesla remains the undisputed leader in the EV market. Since its IPO, the automaker has ramped up production to deliver 500,000 cars every year. Recently, Hertz placed an order for 100,000 Tesla Model 3 sedans. The transaction is set to become the largest single purchase of EVs in history. "EVs are now mainstream, and we have only just begun to see rising global demand and interest,” said Mark Fields, interim CEO, Hertz, as reported by MBN. After the announcement of the deal, Tesla’s value reached the US1.01 trillion value mark, just 18 years after its foundation.
Rivian is preparing for something similar. In September 2019, Jeff Bezos, then CEO, Amazon, said that the company would be investing in electric delivery vans to fight climate change and get closer to its carbon-neutral 2040 plan. “I am incredibly excited to announce that we have just placed an order for 100,000 electric delivery vans. They will be built by a company called Rivian.”
Rivian’s commercial vans will be configurable from 450 to 900 cubic feet of cargo capacity, according to the automaker’s webpage. In addition to the vehicles themselves, Rivian offers technological solutions, such as smart fleet management software. Amazon expects to have 10,000 of the electric delivery vans on the road by the end of 2022.