Three months after announcing an agreement to build electric vans with Mercedes-Benz in Europe, Rivian has changed its mind and is putting the plans on hold. CEO RJ Scaringe today announced the company would "no longer pursue" the agreement with Mercedes-Benz Vans for the time being, according to CNBC.
"We've decided to pause discussions with Mercedes-Benz Vans regarding the Memorandum of Understanding we signed earlier this year for joint production of electric vans in Europe."
Rivian's head honcho noted the company is pursuing "the best risk-adjusted returns" on its capital investments, adding that the company is focusing on its existing consumer and commercial businesses, which represent "the most attractive near-term opportunities to maximize value for Rivian."
That said, the EV startup noted it remains open to exploring future work with Mercedes-Benz "at a more appropriate time for Rivian." In September, Mercedes-Benz Vans and Rivian signed a memorandum of understanding to build electric vans in a new factory in Poland, Hungary or Romania within the next few years, as part of a 50-50 joint venture.
The two parties had planned to make two large van models on common assembly lines, one based on VAN.EA (Mercedes-Benz Vans Electric Architecture) due in 2025 and one based on the second-generation Rivian Light Van (RLV) platform.
Gallery: Amazon Electric Delivery Vehicle (Rivian Van)
Mercedes-Benz Vans said Rivian's decision does not affect the timeline of its electrification strategy or the planned ramp-up of its new EV manufacturing site in Jawor, Poland.
"The option to expand the factory even further by establishing a new joint venture manufacturing company together with Rivian for large all-electric Vans is on hold due to Rivian’s ongoing reprioritization of projects."
Mercedes-Benz Vans press release
Mathias Geisen, the head of Mercedes-Benz Vans, was quoted as saying by CNBC that "exploring strategic opportunities with the team at Rivian in the future remains an option." Mercedes-Benz's new plant will build electric commercial vehicles based on the company's VAN.EA all-electric van architecture. More specifically, the factory will make large closed/panel vans electric vans.
Rivian is one of many startups trying to cash in on demand for electric commercial vans, competing for market share with legacy automakers like Ford and General Motors, which recently started production of its BrightDrop Zevo 600 large van in Ontario, Canada.
The US EV startup already builds an electric van in North America on its RCV platform, the Electric Delivery Vehicle (EDV) for Amazon. The company has a contract to supply 100,000 EDVs to the e-commerce giant, which is also its biggest investor.