Rivian, the electric vehicle manufacturer, is breaking free from its exclusive partnership with Amazon, allowing other businesses to purchase its commercial electric vans. This development was announced alongside Rivian's third-quarter earnings report and comes after discussions in March aimed at removing the exclusivity clause earlier than planned.
The initial exclusivity agreement was set to terminate after Rivian had delivered a total of 100,000 electric vans, expected to occur before the end of this decade. However, Rivian remains committed to fulfilling Amazon's goal.
During an investor call, Rivian CEO RJ Scaringe stated, "We've been working on the exclusivity agreement with Amazon for a while. With that, we've been building relationships with a diverse set of commercial operators, ranging from last-mile to retail."
Amazon had revealed in October that it had already deployed 10,000 Rivian-built vans on the road, meeting a sales target set by the two companies for 2023. While 10,000 vans may sound substantial, reports suggest that this number fell on the lower end of the range Amazon had initially communicated to Rivian, leading to discussions to end the exclusivity agreement prematurely.
Udit Madan, Amazon's transportation executive, highlighted the environmental benefits of this move, saying, "We've always said that we want others to benefit from Rivian's technology in the long run because having more electric delivery vehicles on the road is good for our communities and our planet." Amazon also owns a significant 17% stake in Rivian, underscoring the mutual interest in this decision.
Amazon boasts a colossal fleet, including thousands of semi-trucks, vans, and a substantial number of planes. By opening up the sale of its commercial electric vans to other companies, Rivian is poised to expand its reach and impact in the electric vehicle market while contributing to a greener future.