Following Rivian's announcement to the US Securities and Exchange Commission, it has been revealed that Ford's current stake in Rivian is just 1.5%.
Rivian has had a tough year
The information about the sale comes about a week after Ford confirmed the write-down of its $7.3 billion investment in Rivian. Rivian’s stock value has plunged nearly 70% since February 2022 as the company has been underperforming for a long time and has not met its full-year goal of producing 25,000 vehicles.
Ford took its $500 million stake in Rivian under former CEO Jim Hackett. The automaker intended to use the startup’s platform to build its own electric cars, Lincoln vehicles, and eventually have those electric cars built directly by Rivian.
The partnership was intended to bring the two companies together to build sustainable mobility. However, the project came to a halt shortly thereafter as Ford decided to shift its strategy to creating its own EV manufacturing platform. While at the time a Ford spokesperson claimed that the two automakers would continue to be great partners, it now appears that each brand is focused on its own projects.
The year 2023 has brought new problems
Since last May, Ford’s stake in Rivian has steadily declined. Also, another big investor, Amazon, was forced to write off the $1 billion investment the company made in the automotive startup on May 15, 2022. In early February, we reported on another blow that hit a number of smaller brands, including Rivian.
The automotive startup has to lay off 6% of its workforce due to a severe Tesla-induced drop in electric car prices. The startups are unable to respond to the California automaker’s price cuts and their only option for survival is to cut costs. Further developments at Rivian may be hinted at in the company’s fourth-quarter and 2022 annual report, due at the end of February.