• See the second pic for Ford employees in Detroit, Michigan, USA.
• The image above is the third pictured worker in Detroit.
• The image above is the fourth pictured worker in Detroit.
• Here is the fifth pictured worker in Detroit.
• Here is the sixth pictured worker in Detroit.
• Here is the seventh pictured worker in Detroit.
The announcement that Ford and Rivian have agreed to end their planned partnership in automotive electric vehicles is not good news for future growth.
Ford isn’t retreating from the electric vehicle race; it is simply not partnering with Rivian on the technology, and it isn’t partnering with major auto manufacturers to develop electric vehicles like Tesla. Ford isn’t aligning itself with a smartphone app like Uber for a ride-hailing service, or with any OEM (original equipment manufacturer) or financier that can finance and distribute commercial vehicles. The partnership with Rivian was clearly meant to be for the commercial sector and we learned today that the partnership is no longer in the works.
While plenty of speculation as to why Ford is doing this remains, it should be pointed out that the move is in no way surprising. We have heard that Ford is rebuilding its core engineering business and streamlining production. Ford has laid off, and is now planning on layoff thousands of vehicle engineers and vehicle design folks around the world as it tries to lower the cost of vehicles and the number of vehicle models it offers. (Ford recently sold six US dealerships, but it is retaining its other dealerships). While Ford is changing internally to reduce costs, it isn’t doing so to initiate partnerships.
Rivian still has an interesting story in its operation in Kansas City. The company was initially born out of a very public effort to deflate electric vehicle competition. Back in 2015, two years before a huge electric vehicle factory was announced by Elon Musk, The Jetsons inventor and entrepreneur turned serial entrepreneur, Ray Kurzweil, spoke of his plans to create the first ten self-driving electric vehicles and most importantly a robot owner, preferably in the suburbs. The Cars.com CEO and the MIT inventor co-founded a publicly traded company in 2014 called Vector, with the intention of creating an electric vehicle design company around that vision.
Vector has remained mum on the Electric Replicator, but we do know it now has a new name. Now known as Rivian Automotive, the new company’s primary focus is electric vehicles in the pickup truck segment. Although Rivian was created by Ray Kurzweil, it’s a new company, and a different business model. At the time of its formation in 2014, Greycroft Partners led a $5 million Series A funding round, but The company has now opted for a new investor — global auto dealer car rental giant Avis, which announced a $7 million Series B funding round earlier this month to help finance Rivian’s products.
Since the new company is on a different mission and has a different focus than the previous ones, it isn’t unreasonable to ask what went wrong with the partnership between Ford and Rivian. Besides nearly killing the price of electric vehicles by producing cars at the same time, what went wrong between Ford and Rivian? What made the partnership work so well for 1.5 years — and then not any longer? Could that information have also turned up some secrets about the new shift in the auto industry that led to Ford’s decision to break the partnership with Rivian?
The answer may be a little more complicated than the short statement we hear from Rivian that the plans for a commercial electric vehicle joint venture have ended. If the new company is to roll out a fleet of truly efficient battery cars, there are several things needed in order to succeed in the business of the future. Although a shared product line and technological ownership were seen as the cornerstones for a successful partnership, that could be overly optimistic. Having said that, there could have been some question about the ability of Rivian to control costs in that sector, and bringing Ford in on that side of the table was probably the best thing to do.
In this case, the move away from the partnership will help Ford, and may provide a chance for them to address the weight issues in the electric vehicle arena.