Rivian Automotive is developing a pickup truck and a sport utility vehicle and, according to Jonas, is one of the larger startups focused on complete electric vehicles in terms of headcount.
The nascent electric vehicle market in the U.S. — currently dominated by Tesla Inc. — hasn’t been around long, but it’s already due for a disruption.
Elon Musk’s Tesla grabbed an 80 percent share of the U.S. electric vehicle market in 2018, a mastery that Morgan Stanley sees as “unsustainable.” Once more companies join the fray with their electric cars, analyst Adam Jonas expects the next serious competition to come from a “clean sheet” startup, “with access to talent and capital focused on the fastest growing segments of pickup trucks & SUVs.”
Rivian Automotive is developing a pickup truck and a sport utility vehicle and, according to Jonas, is one of the larger startups focused on complete electric vehicles in terms of headcount. “Companies like Rivian will take elevated importance in investors’ minds” as electric vehicles become the focus of automakers’ investment and strategy, Jonas wrote in a note to clients.
Rivian operated in “full stealth mode” from about 2011 until the company unveiled its two vehicles at the Los Angeles auto show in November. Jonas also noted that, based on public sources, Rivian has scaled significantly to as many as 600 employees today from only about 100 in 2016. It also got a vote of confidence when Sumitomo Corp. of America made a strategic investment of undisclosed size in December 2017.
The U.S. auto market is currently going through an upheaval, with tapering demand and consumers shunning almost anything other than SUVs and trucks. The changes have been sweeping enough to force major carmakers to drop several of their sedan models, with researcher IHS Markit projecting that light trucks will approach a 75 percent share of total U.S. auto sales in 2023.
While Tesla does offer an SUV, the Model X, it’s also its most expensive vehicle, listing it at $88,000 without taxes and fees. The price for Rivian’s SUV starts at $65,000 after a federal tax rebate, while a pickup truck starts at $61,500 after the incentive. Rivian has started accepting pre-order deposits for both models.
Michigan-based Rivian was founded by CEO Robert Scaringe in 2009 after he earned his PhD in mechanical engineering from MIT, while executive director of engineering Mark Vinnels arrived after stints at McLaren and Group Lotus, according to the company’s website.