EV maker Rivian Automotive Inc RIVN is reportedly ramping up the production of its delivery vans.
What Happened: In a recent drone video posted on YouTube by Chicago-based Devon Neff, the Rivian factory reveals extensive rows of delivery vans in its parking lot. This suggests a swift production escalation in anticipation of increased orders from entities beyond the online retailer Amazon Inc. The footage was reportedly captured on Dec. 15.
Amazon placed an order for 100,000 EDVs from Rivian in 2019. As per the initial contract, Rivian could deliver solely to Amazon for four years after initial deliveries. The California-based EV maker started delivering to Amazon in 2022.
Currently, Amazon, who is also a Rivian shareholder, has over 10,000 Rivian-made vans on the road and has delivered over 260 million packages with them.
However, last month, Rivian said that it had amended the terms and conditions of the agreement to allow it to sell its vehicles to other fleet operators as well.
Earlier this month, telecommunications company AT&T Inc T announced that it will purchase EVs from Rivian for its fleet as part of a pilot program focused on cutting transport emissions. AT&T said that it expects to add Rivian’s commercial vans as well as R1 vehicles to its fleet starting in 2024.
Why It Matters: Future Fund Managing Partner Gary Black, for one, is optimistic about the deal and sees Rivian delivering 54,000 vehicles, including 14,000 delivery vans, for the entire year.
However, during the company’s third-quarter earnings call, company CFO Claire McDonough said that the company expects Amazon to take fewer deliveries of its vehicles in the fourth quarter as compared to prior periods due to the upcoming holiday period.
“…Because Amazon limits the intake of new commercial vans during its peak holiday delivery period, we expect a more significant gap between production and deliveries in Q4 relative to prior periods,” McDonough said.
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