The IPO of US electric vehicle manufacturer Rivian is scheduled for this week at NASDAQ, and it will likely become the third largest financing in the US in 10 years if expectations are met.
Ford and General Motors had wanted to invest in Rivian more than two years ago when the EV of Rivian was still in the blueprint phase, and now both Ford and Amazon have become the largest partners of Rivian. Most people probably did not realize that General Motors almost defeated Ford in the fight for the partnership with Rivian.
The Wall Street Journal has recently depicted the secret transaction between Ford and Rivian in the kind of detail that can only be seen in movies. R.J. Scaringe, CEO of Rivian, and Joe Hinrichs, President of Global Operations at Ford, played significant roles in this transaction.
Hinrichs met Scaringe for the first time in 2018. Ford was not prepared to invest in Rivian at the time as it had just missed its target of profitability, and it was General Motors, which had started developing electric vehicles, that had tried to form a partnership with Rivian. However, the executives at Rivian did not rush to finalize the partnership as they were doubtful towards the attitude of General Motors.
Upon Amazon’s investment of US$700 million in Rivian during 2019, Hinrichs met with Scaringe once again, and tried to convince the latter to reconsider on the agreement with General Motors.
Having sensed Scaringe’s hesitation towards General Motors, Hinrichs urged him to reconsider, telling him: “Just because you got engaged to someone doesn’t mean you need to marry them.”
Hinrichs had given Scaringe another opportunity in exchange. The two happened to be both attending a business meeting in Seattle, and Hinrichs suggested Scaringe to return to Detroit by boarding Ford’s Gulfstream business jet. Scaringe had yet to finalize its agreement with General Motors at the time. In a turn of events, Hinrichs had managed to reach a cooperation agreement with Scaringe during the flight, and he even helped the latter to avoid the executives of General Motors after the plane had landed.
When the aircraft taxied into the shared hangar of Ford and General Motors, there was already another jet aircraft waiting outside the hangar, alongside two black Cadillacs. Hinrichs sensed that Scaringe did not want to be seen by General Motors executives, so he then asked the Lincoln “navigator” to drive to the side of the aircraft, and Scaringe got into the “navigator” straight after he got off the plane, who lowered his head when loading his luggage too.
Ford then negotiated with Rivian throughout the entire night, before reaching an agreement at 4 a.m. that night. Ford announced an investment of US$500 million on the startup in April 2019, and had invested a total of US$1.2 billion afterwards.
(News source: 雷鋒網; photo credit: Flickr/Mike Mozart CC BY 2.0)