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Rivian in talks with Amazon to end truck exclusivity

An Amazon electric van made by Rivian

Rivian and Amazon are in talks to adjust a 2019 agreement that says Amazon has exclusive buying rights to Rivian’s electric trucks. The truck maker is now looking to be able to sell its vehicles to other buyers, according to people familiar with the matter. Amazon is planning to buy 10,000 trucks from Rivian but these figures are considered to be at the lower end so Rivian wants the ability to sell to other customers.

When the two companies signed up for the deal which outlined the exclusivity, the economic landscape was much rosier. Now, inflation is causing central banks to increase the cost of borrowing and companies like Amazon and Rivian are having to scale back their ambitions. To help it get through the crisis, Rivian will now want to be able to diversify its customer base to keep sales of its vans up.

Commenting on the talks, a Rivian spokesperson said:

“Our relationship with Amazon has always been a positive one. We continue to work closely together and are navigating a changing economic climate, similar to many companies.”

Amazon also commented saying:

“Rivian remains an important partner for Amazon, and we’re excited about the future.”

While Rivian is likely to be disappointed with the thin number of orders from Amazon this year, Amazon says it is committed to buying 100,000 vans by 2030 to help green up its operations. With that said, allowing Rivian to sell its vans to other companies could be beneficial for Amazon as it owns 17% of Rivian’s shares and if Rivian is doing well, the value of these shares increases.

Source: The Wall Street Journal

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