At this point, we’re more than well aware of the fact that both Ford and Amazon have invested in electric startup Rivian, which has promised to build electric delivery vehicles, electric trucks and electric SUVs. But there was a point in time where General Motors very well could have taken Ford’s place.
The news comes as a result of a new report by The Wall Street Journal, which details just how the Ford partnership came together.
See, Rivian’s CEO R. J. Scaringe — who has recently been accused of creating a gender discrimination in the workplace — was good friends with Ford’s former president of global operations, Joe Hinrichs. That was a great starting point for a new car company — but Hinrichs alone couldn’t guarantee a Ford/Rivian partnership.
That’s because Ford missed its earnings targets in 2018. It didn’t exactly have the money to start throwing at a different company.
Enter General Motors, which had the money to begin working out a deal with Rivian. GM was interested in Rivian at the same time as Ford, and Scaringe had chatted with Mary Barra about a potential investment, and those talks advanced quickly. GM were ready to pull the trigger, and Rivian was ready to take the money.
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WSJ reports that Rivian’s leaders were skeptical of GM, and Hinrichs was desperate to make the Ford deal happen. So, after Amazon invested $700 million in Rivian back in 2019, Hinrichs laid all his cars out on the table. As the article puts it, “Sensing hesitancy about GM, Mr. Hinrichs said he urged the young executive to reconsider. ‘Just because you got engaged to someone doesn’t mean you need to marry them,’ Mr. Hinrichs said he told Mr. Scaringe.”
From there, fate intervened. Both Scaringe and Hinrichs had meetings in Seattle at the same time, and Hinrichs offered Scaringe a ride back to Detroit in his private plane. WSJ reports:
As the plane taxied toward a hangar used by both Ford and GM, executives on board spotted another jet outside the hangar with two GM-made black Cadillac Escalades waiting nearby. Mr. Hinrichs said he sensed Mr. Scaringe didn’t want to be seen by GM executives, so Mr Hinrichs requested that a Lincoln Navigator be pulled alongside the plane. When the door opened, Mr. Scaringe dashed down the plane’s steps and into the Navigator, keeping his head down as Mr. Hinrichs loaded their luggage.
Talks continued until the wee hours of the morning, and in April of 2019, Ford announced it would be investing $500 million in Rivian. Since then, Ford’s investments have reached $1.2 billion.
The full story is worth a read; it’s well-reported and features all the compelling twists and turns of a financial drama. At the end of the day, though, Rivian’s success can be partly attributed to having good friends in high places.