With leading funders, the startup EV Rivian goes public

SILVER SPRING, Md. (AP) – Shares of Rivian Automotive are expected to trade on Wednesday, and the world should have a better idea of ​​investor interest in the electric vehicle market.

Rivian, the EV startup backed by Amazon and Ford, has raised at least $ 10.5 billion in its public offering to help it ramp up production of its trucks, vans and SUVs. It’s the latest in a long line of companies trying to carve out some of Tesla’s dominant market share.

The offering of 135 million shares was priced at $ 78 per share, giving Rivian a market value of $ 77 billion on a fully diluted basis. This compares to Honda’s $ 53 billion and Ford’s $ 80 billion.

Automakers big and small, new and old, are suing Tesla, which has largely dominated the electric vehicle market for years, amassing more than $ 1,000 billion in market value along the way. So far this year, Tesla has sold around 627,300 vehicles.

Craig Irwin, an analyst who covers EV and EV charging businesses for Roth Capital, says that even with more companies entering the EV market, there is still plenty of room for new ones. arrivals.

“EVs are inevitable, and it’s a good thing for the markets to have another credible EV competitor going public,” said Roth. “Rivian’s IPO marks a gradual maturation point for the industry and shows that billions of capital are available for credible players.”

Rivian has a contract with Amazon to build 100,000 electric delivery vans at its factory, a former Mitsubishi plant in Normal, Illinois. Amazon.com Inc. owns around 20% of Rivian before considering the public offering.

Ford Motor Co. invested half a billion dollars in Rivian in 2019 and said the companies will work together to develop electric vehicles. The Detroit automaker owns around 13% of Rivian’s capital before the public offering.

As of October 31, Rivian had approximately 55,400 vehicle pre-orders in the United States and Canada. These orders are placed with a deposit of $ 1000 which can be canceled and refunded.

Rivian rolled out its first vehicle, the R1T electric truck in September, and will launch its electric SUV, the R1S, in December. Prices for the truck start at $ 63,000, while the base SUV package starts at $ 74,000 and approaches six figures with all the additions.

Options for the vehicles include a $ 10,000 battery upgrade that will extend range from 314 miles (505 kilometers) to over 400 miles (643 kilometers). A three-person rooftop tent adds $ 2,650 to the bill, and an off-road recovery kit will cost an additional $ 600.

According to research firm LMC Automotive, in 2020, electric vehicles represented just over 3% of the global automotive market and less than 2% of the US automotive market. The group predicts that these figures will reach around 15% and 12% respectively by 2025.

Rivian, which was founded in 2009, claims it lost $ 426 million in 2019 and $ 1 billion last year. Tesla, which went public in 2010, posted its first annual profit last year.

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