US electric vehicle start-up Rivian raises $1.3bn in fresh funding round

The company has previously raised $2.2bn and was valued at an estimated $5bn to $7bn

A Rivian electric SUV on display. Global car sales are set for a 15% drop in 2020, double the decline during the 2008-09 global financial crisis, according to the IEA. Reuters

Electric vehicle start-up Rivian said it closed a $1.3 billion (Dh4.8bn) investment round led by asset management company T Rowe Price, which also included existing investors Amazon and car maker Ford.

The investment round, which included BlackRock, is the fourth this year for Rivian and positions the Michigan-based company as one of the better-financed players in a crowded EV manufacturing market where Tesla is very established.

"This investment demonstrates confidence in our team, products, technology and strategy," Rivian chief executive RJ Scaringe said.

EVs still make up only a small piece of the global automotive market. While Tesla is the best-known maker, China and Europe are pushing car manufacturers to roll out EVs. Ford, General Motors and others have announced plans to spend billions of dollars developing the vehicles.

Founded in 2009, Rivian plans to build an all-electric pickup truck, the R1T, and the companion R1S SUV, starting in late 2020. Both models are based on a Rivian-designed “skateboard,” a chassis that bundles electric motor, batteries and controls and can accommodate a variety of body styles.

Prior to this latest announcement, Rivian had raised $2.2bn from investors, according to investor website PitchBook, and was valued at an estimated $5bn to $7bn.

The company’s total valuation in the wake of the latest investment round was not immediately clear.

Rivian said no new board seats were added as a result of the latest investment.

T Rowe Price has placed other bets in the auto sector. It is a large Tesla shareholder and has also invested in GM's majority-owned Cruise self-driving division. Along with Amazon, T Rowe Price is also vested in self-driving car software start-up Aurora and British online food delivery company Deliveroo.

“T Rowe Price is excited to invest in Rivian as it moves the innovation frontier forward with its compelling sustainable transport solutions for both consumers and businesses,” T Rowe Price growth stock fund portfolio manager Joe Fath said.

Amazon, which has relationships and deals across the auto industry, led a $700 million investment round in Rivian in February. The e-commerce company also ordered 100,000 electric delivery vehicles from Rivian. The first Amazon vans will be built at a former Mitsubishi Motors plant in Illinois, starting in 2021.

Amazon declined to comment on Monday.

Ford invested $500m in Rivian in April and plans to help it begin production in Normal in 2020.

“We want to maintain a meaningful value in the ownership and future of that company,” Ford spokesman TR Reid said about Rivian.

In November, sources said a battery-powered Lincoln SUV, due in mid-2022, would be the first Ford vehicle to be built on the Rivian skateboard.