What is Rivian and why did it reduce the profits of Amazon and Ford?

Both Amazon and Ford reported quarterly profit losses this week, citing their investments in Rivian Automotive.

Amazon on Thursday reported a rare quarterly loss of $3.84 billion, due entirely to a $7.6 billion loss in the value of its stock investment in Rivian Automotive. Same with Ford, which said it lost $5.5 billion on its Rivian holdings in the quarter, prompting it to report a total loss of $3.1 billion.

Why would a publicly hidden startup cause headaches for such US business giants?

What is Rivian?

Rivian Automotive is an electric truck manufacturer that owns a former Mitsubishi plant in Normal, Illinois.

It was founded by RJ Scaringe, who earned his Ph.D. from the Massachusetts Institute of Technology in 2009. In 2011, Scaringe scrapped plans to build a coupe, signaling the auto industry’s shift to pickups.

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Two Rivian trucks parked side by side.

Why did Ford and Amazon invest?

Rivian’s promise and Scaringe’s vision and connections have always attracted big investors. Scaringe’s connections at MIT linked him to the Jameel family of Saudi Arabia who, along with other investors, helped the company raise $450 million.

After a flash truck revealed that even attracted singer Rihanna In conjunction with the Los Angeles Auto Show in November 2018, Amazon announced in February 2019 that it would lead a $700 million investment in the company. that April, Ford said it was investing $500 million.


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