Mercedes and Rivian partner to build electric trucks

Both companies will invest in and operate a new assembly plant at an existing Mercedes facility in central or eastern Europe, which will start production in “a few years,” according to a statement. The companies did not provide details, including investment figures.

“We will both benefit significantly from this joint venture,” Mathias Geisen, head of Mercedes’ van division, told reporters, adding that the move will help the partners bear the multibillion-euro cost needed to raise the manufacture of electric vans.

Automakers are increasingly looking to share the costs of developing and producing electric vehicles as they reshuffle factories and overhaul model lines to catch up with Tesla Inc. The partnership brings together Rivian, which has Amazon. com Inc. and Ford Motor Co. among its major shareholders, with one of the most experienced vehicle manufacturers in the world.

The Mercedes plant in Kecskemet, Hungary is likely to be on the list of candidates for the joint factory. The plant, opened in 2012, currently manufactures entry-level Mercedes-Benz cars such as A-Class, B-Class, and C-Class models. The automaker plans to reduce production of these types of vehicles as part of its strategy to switch to entry-level models. high-end.

Following its successful debut in late 2021, Rivian has faced production issues, high costs, and economic volatility. The company briefly halted work at its Normal, Ill., plant earlier this year to make repairs and process improvements to help increase production.

Persistent supply chain issues and high raw material expenses have disrupted operations, prompting Rivian to recently cut its full-year earnings expectations.

Last month it said that increasing production remains its main goal, although supply chain constraints would be the limiting factor. The startup has been looking at options for a manufacturing hub in Europe since early last year, Bloomberg reported.