California based startup Rivian and Mercedes-Benz Vans have signed a memorandum of understanding (MOU) for electric vans production and after clearances from regulatory authorities a joint venture will be formed that will initiate a new strategic partnership. The joint venture initially plans to build two large electric vans together and will leverage an existing Mercedes‑Benz site in Central or Eastern Europe to set up an all-new electric-only production facility. The companies are hopeful that efficient manufacturing will allow them to further explore options for increased synergies between the two and the strategic partnership won’t be limited to two vans.
The electric-only production facility will build one vehicle based on Rivian’s second generation Rivian Light Van (RLV) architecture and the other one would be using Mercedes’s VAN.EA platform. Although the production would not start for a few years, teaming up will definitely boost production. Joint manufacturing will help achieve cost efficiency through economies of scale and let them offer the van at a more affordable price to its commercial vehicle customers.
At the joint press release, the heads of both the companies in their statement said:
RJ Scaringe, Chief Executive Officer of Rivian:Rivian was created to encourage the world to transition away from fossil fuel consumption by creating compelling products and services. We’re delighted to be partnering with Mercedes‑Benz on this project. Mercedes‑Benz is one of the world’s best known and respected automotive companies, and we believe that together we will produce truly remarkable electric vans which will not only benefit our customers, but the planet.
Mathias Geisen, Head of Mercedes-Benz Vans:As a pioneer in the field of locally emission-free transportation Mercedes‑Benz Vans has gained broad experience in producing and launching eVans since 2010. Now we are accelerating the transformation to a fully electric product portfolio. From 2025 onwards, all vans based on our new architecture VAN.EA will be electric-only.
I am delighted that as part of this transformation we are now joining forces with Rivian – a highly dynamic and inspiring partner with a strong technology position. We are sharing investments and technology because we also share the same strategic ambition: accelerating the electrification of the van market with sustainable and superior products for our customers
The initial intent behind the agreement looks promising and it is a good chance for the US automaker Rivian to enter the European market. Earlier as well, Rivian had partnered with Ford to build vehicles together but that deal was rolled back in late 2021 as Rivian was already busy launching its own vehicles first in the market. At present, Rivian should ramp up the production of its existing lineup to turn profitable and may look forward to diversifying at a later stage. However it cannot be considered a done deal yet because the MOU has to pass through regulatory hurdles. And there are no timelines specified for the project that will also give a fair bit of flexibility to alter the future course of action.