This week included a pair of significant, technologically driven moves by the Blue Oval to capitalize on possibilities for electric vehicles as well as cloud connectivity.
On Wednesday, Rivian announced an equity investment of $500 million from Ford. In addition to the investment, the companies have agreed to work together to develop an all-new, next-generation battery electric vehicle for Ford’s growing EV portfolio by using Rivian’s skateboard platform.
And on Tuesday, Ford and the creators of Autonomic — a transportation mobility cloud (TMC) — signed a multi-year, global agreement with Amazon Web Services (AWS), which will expand the availability of cloud connectivity services and connected car application development services for the transportation industry.
Cox Automotive pointed out the investment with Rivian places Ford among the largest investors in the privately held company. Experts mentioned Rivian has been in the spotlight recently, with “interesting” concept vehicles appearing at major auto shows and, more notably, an infusion of $700 million led by Amazon in February.
“Ford’s investment in Rivian is a smart one,” Autotrader executive analyst Michelle Krebs said in commentary distributed by Cox Automotive on Wednesday. “Ford has committed to producing numerous electrified vehicles in the future, including pickup trucks, and Rivian has an intriguing concept to get the job done. Rivian leverages Ford’s leadership, expertise and massive volume in pickup trucks as well as its vast distribution network.
“The Amazon investment in the Rivian mix may well give Ford an in with the delivery services, possibly with electric cargo vans. And, of course, sport utility vehicles are another big opportunity the two could collaborate on,” Krebs continued.
“Bigger picture, the first step to proliferate electric vehicles, and ultimately autonomous vehicles, is through commercial fleets,” she added.
Rivian said it already has developed two “clean-sheet” vehicles with adventurers at the core of design and engineering decisions. The company indicated its launch products — the five-passenger R1T pickup and seven-passenger R1S SUV — can deliver up to 400- miles of range and provide an “unmatched” combination of performance, off-road capability and utility.
The vehicles are slated to become available late 2020.
“This strategic partnership marks another key milestone in our drive to accelerate the transition to sustainable mobility,” Rivian founder and chief executive officer RJ Scaringe said in a news release. “Ford has a long-standing commitment to sustainability, with Bill Ford being one of the industry's earliest advocates, and we are excited to use our technology to get more electric vehicles on the road.”
Ford executive chairman Bill Ford added, “We are excited to invest in and partner with Rivian. I have gotten to know and respect RJ, and we share a common goal to create a sustainable future for our industry through innovation.”
Ford also said it intends to develop a new vehicle using Rivian’s flexible skateboard platform. This strategy is in addition to Ford’s existing plans to develop a portfolio of battery electric vehicles.
As part of its previously announced $11 billion EV investment, Ford already has confirmed two key fully electric vehicles: a Mustang-inspired crossover coming in 2020 and a zero-emissions version of the best-selling F-150 pickup.
“As we continue in our transformation of Ford with new forms of intelligent vehicles and propulsion, this partnership with Rivian brings a fresh approach to both,” Ford president and chief executive officer Jim Hackett said. “At the same time, we believe Rivian can benefit from Ford’s industrial expertise and resources.”
Rivian noted that it remains an independent company. The investment is subject to customary regulatory approval.
Following Ford’s investment, Joe Hinrichs, Ford’s president of automotive, will join Rivian’s seven-member board.
In commentary provided by the company via email, IHS Markit principal automotive analyst Stephanie Brinley said: “Ford’s $500 million investment into Rivian and the decision to work with the EV startup reflects, among other things, the ongoing shift in the automotive industry toward more focused partnerships and collaborations, versus traditional mergers.
“Creating this type of partnership is a path Ford has been moving forward with aggressively for the past two years. Both parties bring specific expertise to the partnership, and have much to offer each other,” she said. “This partnership model is particularly important for EVs and mobility technology, which are extremely capital intensive with a resulting scaled, profitable and sustainable mobility business possibly a decade or more away. The move also reflects the viability of Rivian’s business model, which includes both selling the skateboard and producing its own vehicles.
“Rivian is also free to use the Ford equity funds as it sees fit, and to work with other partners. Ford will benefit from lessons learned, as will Rivian. Rivian expects to be successful, and Ford should see return on that investment from a purely financial perspective as well.”
More details about collaboration involving Ford, Autonomic and Amazon
As mentioned previously, Ford, Autonomic and Amazon all entered into a multi-year, global agreement. The collaboration represents an expansion of the existing relationships involving Ford, Autonomic and AWS.
Amazon Web Services will power the Autonomic Transportation Mobility Cloud, giving automotive manufacturers and software developers the cloud infrastructure needed to build innovative connected vehicle services at scale, according to a news release.
Officials explained that through this collaboration, Autonomic’s TMC will be powered by AWS to become the standard connected car solution for Ford vehicles. Ford Mobility and Autonomic said they chose AWS for its global availability and the breadth and depth of AWS’ portfolio of services, including Internet of Things (IoT), machine learning, analytics and compute services.
“This collaboration will significantly expand our opportunity to deliver the very best experiences to Ford vehicle and mobility customers,” Ford Mobility president Marcy Klevorn said. “I am excited that our future cloud standard for connected vehicle solutions will be powered by AWS in addition to Autonomic’s Transportation Mobility Cloud.
“Working with AWS and Autonomic, Ford and our mobility partners will have access to the industry-leading mobility platform,” Klevorn added.
The companies continued that the collaboration with AWS can allow additional partnership and business opportunities for automakers, public transit operators, large-scale fleet operators and software developers.
As a technology partner in the AWS Partner Network (APN), Autonomic will also work with independent software vendors (ISVs) and system integrators (Sis) to offer vehicle connectivity services and capabilities for developing connected vehicle cloud services, vehicle features and mobile applications to automotive manufacturers and mobility application developers.
“This marks the next stage of what has already been an immensely gratifying collaborative relationship with AWS,” Autonomic co-founder and chief executive officer Gavin Sherry said. “One of the many goals we have in common is to build a cohesive framework for vehicle makers and developers, allowing them to focus on creating some of the best experiences for customers who use our connectivity systems. Now, with the announcement of this strategic collaboration, our platforms’ capabilities will expand greatly.”
Officials also noted automakers and application developers can leverage the TMC to free themselves from the large investment and extensive time required to build their own connectivity layer. Instead, by connecting via TMC, they can apply those resources to creating innovative products and solutions that differentiate them in their marketplaces.
TMC, already connected to millions of vehicles, can provide secure, bi-directional connectivity to the cloud from vehicles. It securely can ingest and enrich vehicle data in real time, and it can give software developers easy access to the processed data to be able to create rich applications for drivers, fleet-owners, and vehicle manufacturers.
Officals added TMC is vehicle brand agnostic and can provide the API-centric, cloud-based software development experience that developers of mobile applications prefer.
AWS chief executive officer Andy Jassy closed by offering how the Ford and Autonomic developments could lead to more advancements in this space.
“The collaboration with Ford and Autonomic transforms the way automotive customers and partners develop connected vehicle cloud services,” Jassy said. “Autonomic customers will be able to bring innovative mobility services and differentiated customer experiences to their customers worldwide, by integrating TMC with AWS, the industry’s broadest and deepest cloud platform.
Such capabilities, together with AWS’s partner network community and broad customer base in automotive, will help reimagine the future of the automobile industry,” Jassy went on to say.