California EV pure play Rivian has signed a deal with US telecommunications firm AT&T for a pilot scheme of its electric delivery vehicles (EDVs) in the latter’s fleet. AT&T becomes the first new customer added by Rivian for its vans after its exclusivity deal with retail heavyweight Amazon ended in October.
The exclusivity deal with Amazon has helped prop up Rivian’s revenue since it was signed, accounting for 21pc of revenue last year, equal to $343mn. Rivian will continue to supply EDVs to the retailer but is now free to strike new supply deals with other fleet operators. Rivian still expects a similar proportion of revenue from Amazon this year, analysts at financial services firm Cantor Fitzgerald calculate.
AT&T says that the vehicles will be phased in as part of a “pilot programme”, suggesting that no firm commitments to large volumes of unit purchases have been made, so revenue comparable to the Amazon deal is unlikely any time soon.
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“AT&T expects to begin adding the Rivian commercial van and R1 vehicles to its fleet in early 2024 to begin evaluating the various ways these vehicles help improve safety, reduce costs and cut its carbon footprint,” AT&T says.
“Our category-defining vehicles offer some of the most advanced technology in the sector and are continually improved through over-the-air updates. We are very much looking forward to expanding our relationship with AT&T to help them achieve their climate goals,” adds Dagan Mishoulam, vice-president of strategy and fleet at Rivian.
“In addition to Rivian collaborating with AT&T to provide fleet vehicles for a pilot, AT&T is the exclusive provider of connectivity to all Rivian vehicles in the US and Canada,” AT&T says, adding that “with AT&T connectivity, Rivian uses over-the-air software updates to consistently improve its vehicles with new features that elevate the driving experience for its customers”.
Amazon currently operates more than 10,000 EDVs across over 800 cities in the US in addition to around 1,000 in Germany. The agreement began with an order of 100,000 EDVs placed in 2019, with the full number of vehicles set to be delivered by 2030.
The agreement which could promise a future revenue boost for the automaker comes days after reports that Rivian had laid off around 20 battery staff. Financial analyst and journalist Clark Schulz notes that Rivian “currently buys battery cells from South Korea’s Samsung SDI and assembles them into packs at its manufacturing plant in Normal, Illinois”.
“The decision to pare down the battery cell development could be a sign that Rivian no longer expects to make its own batteries at the new factory being built in Georgia,” Schulz suggests.
Ciaran has written about finance, politics and culture. He is passionate about e-mobility and what it means for our way of life.
Ciaran has a Masters in Ancient Philosophy from Oxford University.
