Electric truck maker Rivian falls victim to falling battery prices

The company started by popularising electric trucks like the Electric-Truck has folded, succumbing to a $32m loss from a troubled lithium-ion battery operation. The US inventor, and former Teva Pharmaceuticals chief, sold most of…

Electric truck maker Rivian falls victim to falling battery prices

The company started by popularising electric trucks like the Electric-Truck has folded, succumbing to a $32m loss from a troubled lithium-ion battery operation.

The US inventor, and former Teva Pharmaceuticals chief, sold most of his shares in the electric-truck manufacturer last week, as the venture tried to find a niche to make money.

The flotation of Rivian last year gave him a $190m net worth but saw its shares plummet.

The weak lithium-ion battery market led to weaker-than-expected sales at Rivian Electric Vehicles Inc, but the company had relied too heavily on the venture too late in the game.

Its shares fell 16.6% in its debut on 14 February 2018, then slid further to a low of $1.85 each in November 2017, before recovering somewhat to reach $12.66 in June last year, a gain of 33.3%.

In December, the company withdrew the IPO but began shopping the business around. Its most recent deal, with a Japanese autoparts supplier, would help it reduce its losses from the lithium-ion venture.

“We are de-leveraging by acquiring the overburden and completing the electric drive train build-out,” Rivian said on its website.

It will sell its entire shares in Rivian to the company’s bank, which has arranged a $25m senior secured revolving credit facility to cover the venture’s working capital needs for the coming three years.

When it initially listed, Rivian said it wanted to serve a large market in America, Europe and Japan.

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Electric-truck companies are holding steady in terms of vehicle deliveries, although electric trucks have not yet made major strides in the US market.

“An electric truck with a large payload is one of those weird things that the traditional truck dealerships just don’t have a way to service,” Dan Morris, at ClipperCargo, said earlier this year.

Mr. Morris’ company had focused on electric vans with higher payloads of 40 to 50 tonnes, which was cheaper to make but tougher to retrofit into larger heavy duty trucks.

Since then, Navistar, which rebranded as Oshkosh Truck, has released its own e-truck.

US electric buses and cargo trucks tend to be less expensive than trucks, but still have larger payloads that need more planning and planning, he said.

The OAO Daimler AG maker of heavy commercial vehicles, Freightliner, also has the first commercial electric vehicle for delivery in North America.

At least some other electric trucks may be around by the time Rivian goes out of business. Plugged In recently announced a production run for 100 hybrid electric vocational trucks for the US commercial fleet operator, Ryder System Inc.

Oded Shein, chief technology officer at Rivian, in December wrote an open letter to potential investors that said he would be working on electrifying trucks in the US as his main focus.

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