Amazon and General Motors plan to invest in Rivian, the maker of electric pickup trucks, according to reports by Reuters and Bloomberg, citing sources familiar with the matter.
The Rivian deal would be the second transportation investment for Amazon in a week. Last Thursday, autonomous vehicle startup Aurora announced that it had raised $530 million from investors including Amazon, Sequoia and others.
So why the sudden interest from Amazon in autonomous and electric vehicles? For starters, it could be part of a larger plan to reduce costs. The company last year launched a partner program for small delivery companies, which operate fleets of 20 to 40 vehicles. Developing relationships with electric and autonomous vehicle startups may be yet another way to eventually wean itself off of third-party shippers.
The e-commerce giant spent $9 billion on shipping in the fourth quarter of last year and acknowledged “intense competition” in transportation and logistics.
Amazon has also been making efforts to extend its Alexa technology from the home to the car, through partnerships with automakers and device makers, and its own Echo Auto in-car gadget, announced last year but still available only by invitation.
GM’s motivations are more obvious. The maker of the successful Chevy Bolt electric car has not yet announced plans for an electric pickup. Pickup trucks deliver substantially higher profit margins than smaller vehicles.
The investments would give each company a minority stake and value the startup at $1 to $2 billion. The deal could be announced this month, according to the sources cited by Reuters and Bloomberg. Rivian’s R1T electric pickup, which will reportedly go from zero to 60 in 3 seconds and tow 11,000 pounds, are expected to reach customers in late 2020. The company will manufacture the trucks in a former Mitsubishi Plant in Normal, Ill.
Neither GM nor Amazon confirmed the Rivian plans with Reuters or Bloomberg. Amazon declined to comment on the report.
“We admire Rivian’s contribution to a future of zero emissions and an all-electric future,” GM told GeekWire in an email.
