Rivian Automotive
was given another boost Tuesday as
Amazon
said it would soon roll out its first European delivery vans from the U.S. electric vehicle start-up.
Shares in the truck maker have struggled this year, but they soared 17% to $19.56 Monday after the company’s production rose more than 200% year over year in the second quarter and sales increased by around 180%. The stock is now 6% up so far in 2023, having climbed 45% in the past five trading sessions.
Amazon’s
(ticker: AMZN) announcement was largely expected after it pledged to order 100,000 vehicles from Rivian (RIVN) in 2019. It is also the EV company’s biggest shareholder. But it’s still a significant milestone and is another encouraging sign when it comes to EV adoption globally—especially after strong deliveries for
Tesla
(TSLA) and BYD (1211.Hong Kong) last quarter.
The tech giant said more than 300 Rivian electric vans will be rolled out across Germany in Munich, Berlin, and Dusseldorf in the coming weeks, as it reiterated its plan to have 100,000 of the U.S. EV maker’s delivery vans on the road globally by 2030.
“Amazon is committed to reaching net-zero carbon by 2040, and reducing our delivery-related emissions is a critical part of that goal,” the company’s country manager for Germany, Rocco Bräuniger said in a statement Tuesday.
The custom delivery vans are shorter and thinner than their U.S. counterparts, to better fit European roads, Amazon said. It began rolling out Rivian vans in the U.S. in July last year.
Mizuho analysts, led by Vijay Rakesh, said better adoption of its delivery vans with “strong traction from Amazon and adoption from other last-mile delivery providers,” was an upside risk for the stock, in a note last month.
The analysts’ upside case sees Rivian shares heading to $50, while their base-case target price is $27—highlighting the potential of the Amazon partnership. A faster production ramp up, and outpacing new entrants such as Tesla’s Cybertruck,
General Motors
General Motors
‘ (GM) Hummer, and
Ford’s
(F) F-150 are other factors in the upside scenario.
Write to Callum Keown at [email protected]
Read the full article here