Breakups are tough — even amicable ones. But a reassessment usually lays bare the issues that inform the future. So it’s worth wondering about the relationship between the century-old Ford Motor Co and recently-floated electric vehicle company Rivian Automotive Inc.
It was meant to work — on paper. A large, traditional manufacturer ties up with a new startup that boasts all the right technology and specs, to make an electric version of an American favourite — the SUV. They looked like the perfect couple. This month, though, the companies abandoned plans to jointly develop an EV.
It’s a shame. Investors loved it. For Ford, it was a big, bold bet on the future at a time when it didn’t know much better and skittishness around the incessant rise of EV-maker Tesla Inc made traditional carmakers splash out.
They took big stakes in various futuristic technologies or forged partnerships that aligned them with the next-generation of vehicles and the technology that would power them.
For Rivian, a hot startup with all the ideas à la mode around sustainability and greener vehicles, the partnership with a manufacturing giant would ensure that production issues didn’t impede its rise.
Rivian went public in one of the biggest offerings ever. The value of Ford’s stake stands at around $12 billion. Just 10 days later, they called off jointly making an electric vehicle — mutually, they say. Ford still holds its 12%. Both companies seem to have come out fine, in theory.
But the making-a-car bit was the premise of the relationship. So what about those lofty goals set at the time of the initial investment led to it falling apart?