'%20x='0'%20y='0'%20height='100%25'%20width='100%25'%20%0A%20%20%20%20%20%20%20%20%20%20xlink%3Ahref='data:image/jpg;base64,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'%3E%3C/image%3E%3C/svg%3E)
Shares of Rivian Automative Inc. opened Monday, May 10, at a new low after Ford Motor announced plans to sell 8 million shares of the electric vehicle startup.
The EV maker's share price is currently down more than 18% in premarket trading, after a 10% plunge when Ford's stock sale announcement was made public. Ford currently owns an impressive 11.4 percent of its shares, totaling approximately 102 million shares. The Detroit automaker intends to sell 8 million shares through Goldman Sachs.
According to reports by CNBC, the sale was a "done" deal, and shares are already being distributed.
The EV company announced in March that it expected to produce 25,000 electric trucks and SUVs this year, despite supply chain constraints and internal production snags. That would be less than half of the vehicle production the EV maker forecasted to investors during its IPO roadshow last year.
The stock plummeted after it became clear that the company would be unable to produce electric trucks at the rate or volume that some investors expected.
Reasons for Ford's breakup with Rivian
Ford and the EV maker have scrapped their plans to develop an EV together. In an interview, Ford CEO Jim Farley stated that the automaker will go it alone to meet its goal of producing 600,000 vehicles per year by the end of 2023.
When Ford invested $500 million in the firm in 2019, the two stated that they would collaborate to produce a Ford-branded EV with the startup's "skateboard" powertrain. The two canceled a Lincoln-branded EV in early 2020, citing the pandemic.
The complexities of integrating their hardware and software are the reason Ford and the EV maker decided not to proceed with the project mutually. According to the company, the decision has had no effect on their relationship.
Miranda Jimenez, a spokesperson for Rivian, said:
“As Ford has scaled its own EV strategy and demand for Rivian vehicles has grown, we’ve mutually decided to focus on our own projects and deliveries. Our relationship with Ford is an important part of our journey, and Ford remains an investor and ally on our shared path to an electrified future.”
Ford officials said:
“We respect Rivian and have had extensive exploratory discussions with them, however, both sides have agreed not to pursue any kind of joint vehicle development or platform sharing.”
The EV company's stock price rose to $179.47 a week before falling back to earth. Stocks have dropped more than 75% since its initial public offering.
This decline has also impacted its two largest shareholders, Ford and Amazon. Ford reported last month that it lost $3.1 billion in GAAP terms in the first quarter, primarily due to a write-off of the value of its stake.
