Rivian ends exclusivity clause with Amazon

Rivian will offer its electric delivery vans to other companies in future and is cancelling its exclusivity clause with Amazon. According to the e-commerce giant, the move had been planned anyway.

Citing internal Rivian sources, the Wall Street Journal reported back in March that Rivian was negotiating with Amazon to amend the existing framework agreement. Now, the plan has officially been finalised. Both sides are keeping quiet about the details. However, Amazon says that it had been planned anyway.

The exclusivity clause dates back to 2019 when Amazon agreed with Rivian to purchase 100,000 electric vans by 2030. The first electric vans have been in use for Amazon since last year.

“Rivian and Amazon share a mission to decarbonise last mile delivery and have been working together since 2019 to make that a reality,” says Udit Madan, vice president of transportation at Amazon. “This has been part of our plan with Rivian from the beginning – we’ve always said that we want others to benefit from their technology in the long run because having more electric delivery vehicles on the road is good for our communities and our planet.”

It sounded slightly different in the Wall Street Journal just over six months ago. The report stated that Amazon’s purchase volumes were below expectations – around 2023 units with some 10,000 EVs firmly ordered. According to the paper’s sources, this is not the first time Amazon has remained at the lower end of the agreed range with its binding orders.

Rivian was understandably displeased with its investor, as it had calculated with higher quantities to justify manufacturing the EV vans on its own production line. Rivian is under pressure: last year, the company delivered 20,332 electric vehicles, but due to the investment costs in scaling up production, the loss rose to 6.75 billion dollars.

Without the exclusivity clause in the Amazon contract, Rivian is now free to sell the vehicles to other customers.

“We’re excited to open sales of our electric commercial van to more businesses. Around a quarter of CO2 emitted in the transportation sector in the US comes from commercial vehicles, so it’s imperative we do all we can as soon as possible to help cut emissions,” says RJ Scaringe, CEO of Rivian. “Amazon is, and will remain, a key partner for us, and we look forward to continuing to work closely with the Amazon team as we help them to achieve their Climate Pledge goal.”

Rivian also published its financial figures for the third quarter. The US company posted sales of around 1.34 billion US dollars from July to September, compared to approximately 1.1 billion in the second quarter. Rivian’s net loss in the third quarter of 2023 was about 1.37 billion dollars, slightly higher than in the second quarter (approximately 1.2 billion dollars).

As reported, Rivian produced 16,304 vehicles in the third quarter and delivered 15,564. Rivian is again slightly raising its production forecast for the full year 2023 – from 52,000 to 54,000 vehicles.

rivian.com, downloads.rivian.com (PDF)