Rivian IPO: Amazon’s favorite electric car company is now worth more than Ford or GM

Rivian went public on Wednesday, marks the biggest IPO ever in the United States since 2014. The electric pickup and SUV maker values ​​its stock at $78 per share and has raised about $12 billion, the amount the company expects to spend. to ramp up the production and design of more models. While that price establishes Rivian’s valuation at around $70 billion, the automaker’s market capitalization has risen above 90 billion dollars, after the stock started trading at close to $107 a share on day one.

Rivian pay for the initial public offering back in august. The 12-year-old company, which is backed by Amazon and considered one of the biggest threats to Tesla, is now one of the world’s most valuable automakers. billions of dong more than Ford or GM – although as of October, it has only delivered 156 vehicles. Rivian’s first vehicle, a $73,000 pickup, begins shipping in September, and the second model, a $75,500 seven-seat SUV, is expected next year.

In some ways, Rivian’s timing is good. This summer, President Joe Biden issued an executive order calling for electric vehicles to account for half of all new car sales in the United States. to 2030and more and more old car manufacturers have committed to shift their production to the tram in the next two decades.

But as the world continues to grapple with the pandemic, Rivian faces some serious challenges. Semiconductor shortages have caused production delays and shutdowns in the auto industry. There is also no multiple charging stations available across the United States, leaving some potential electric vehicle buyers worried about running out of juice.

Jeremy Michalek, a professor of public policy and engineering at Carnegie Mellon, told Recode in August that “It’s a big deal when there’s more public infrastructure. “Perhaps the first priority is to make sure there are enough fast chargers on the highway rest stops so you can take the car wherever you want to go.”

Like Tesla, Rivian is sell home chargers and develop a nationwide toll collection network. The company expects to have 10,000 stations by the end of 2023, many of which will be in remote areas. Just as Tesla did, Rivian is taking an AI-centric approach to its vehicles. Rivian has invested heavily in hands-free, semi-autonomous driving technology with a feature set called Driver +, which sounds a lot like Tesla’s Autopilot feature. In one lawsuit, Tesla even accused Rivian of stealing his trade secrets after hire its former employees.

But one big difference between Rivian and Tesla is the type of electric vehicle the two companies are selling. After being founded in 2009 and keeping it a secret for many years, Rivian announced in 2018 that its first models would be a pickup truck and an SUV for off-road driving. That’s a notable difference from Tesla, which focuses primarily on selling cars and crossovers. (Tesla announced its first pickup truck, the Cybertruck, in 2019, but deliveries have already delayed until 2022.)

Rivian is also attracting commercial customers, including its own influential backers. After participating in two funding rounds for the startup, Amazon last year commitment to buy an electric car to deliver 100,000 VND from Rivian in 2030. Former Amazon CEO Jeff Bezos and three other passengers on Blue Origin’s first flight with humans on board riding on a Rivian SUV to the launch location.

Ford, which plans to release an electric version of its popular F-150 pickup truck next year, has also invested more half a billion dollars into the electric car starter.

Complicated timing of Rivian’s IPO

There’s no doubt that Biden is passionate about electric cars. The Biden administration has begun electrification the entire federal fleet of cars, SUVs and trucks, more than 600,000 cars. Meanwhile, the White House and Congressional Democrats are pushing for the Postal Service buy up to 165,000 electric delivery vans. NS most recent version Biden’s bipartisan infrastructure proposal includes $7.5 billion to build a national network of electric vehicle chargers. (Tesla CEO Elon Musk also started open Tesla Superchargers to electric vehicles from other manufacturers.)

But while electric vehicles are growing in popularity globally, the US faces slower growth rates than China or Europe. Last year, global electric vehicle sales 41 percent increase, according to the International Energy Agency, an intergovernmental energy policy think tank. While electric vehicle sales in the US lag behind in China and Europe, sales of hybrid vehicles developing, a sign that more consumers may prefer electric vehicles.

In one recent Pew survey, about 7% of Americans said they own an electric or hybrid vehicle and 39% said they would consider buying one. Electric car prices are higher definitely a contributing factor acceptance rate is slower than in the United States. But the price of the battery, It’s a the most expensive part Electric vehicles are on the decline, so Americans could see cheaper electric cars in the future.

Pandemic barriers have also plagued the auto industry. Rivian, the company that was originally supposed to release its pickup in July, has twice postponed deliveries. Late last month, Rivian founder and CEO RJ Scaringe tell customers who have booked a car in advance that Covid-19 has interfered with everything from “building facilities, to installing equipment, to supplying components for vehicles (especially semiconductors).” The same chip shortage forces Tesla to re-code its car, and experts are concerned that the lack of semiconductors could delay production of the new electric Ford F-150.

However, if Tesla’s massive success is any indication, Rivian will be looking for eager, outdoor customers who want an all-terrain EV. Considering the current challenges, the company is leaning heavily on staying out of Tesla, and a growing number of legacy automakers want a piece of the electric vehicle market. GM will start offering an electric version of the previous GMC Hummer truck end of the year. And the Jeep is expected release electric version of Wrangler in 2023. President Biden gave a test driver.

Update, November 10, 2:15 p.m.: This story has been updated to include news that Rivian will be made public.