Amazon’s Epic EV Order

September 26, 2019

When we have a fleet made up of EVs, powered by wind and solar, there will be much less motivation for going to War in the Middle East.
Just sayin’.

Detroit News:

Plymouth-based electric vehicle startup company Rivian Automotive has an agreement to fill the largest order of fully electric vehicles in automotive history.

The startup is to build 100,000 electric vans for e-commerce giant Amazon.com Inc. over the next decade, Rivian said Thursday. The first batch of vans is expected to hit U.S. roadways by 2021, with 10,000 on the road by late 2022, said Rivian spokeswoman Amy Mast. All 100,000 are to be operating in Amazon’s fleet by 2030.

That’s a big step for a company that last fall didn’t even have signs identifying its Plymouth headquarters when it surprised the Los Angeles Auto Show with sleek prototypes of the electric seven-passenger RS1 SUV and four-passenger RT1 pickup with a claimed 400-mile-plus range. And it could prove a smarter way to do business than Tesla Inc., the company to which Rivian will inevitably be compared.

“It’s a real vote of confidence from Amazon,” said Sam Abuelsamid, principal analyst at Ann Arbor-based Navigant Research, who focuses on mobility. “Buying early vehicles would be an indicator for other companies who are considering electrifying their fleet that Rivian is a company they need to take a look at if they’re going to do this. Amazon doesn’t make decisions like this lightly.”

The vans are to be built at Rivian’s plant in Normal, Illinois, alongside the SUVs and pickups Rivian plans to build in a former Mitsubishi plant.

“This provides an opportunity for mega-tech, through the sheer size and capital available, to invest in electric vehicle and accelerate EV penetration,” Morgan Stanley analyst Adam Jonas wrote in a Thursday note to investors.

When Mitsubishi ran the Illinois plant, it churned out around 250,000 vehicles annually, Abuelsamid said. Between the pickup, SUV and Amazon van, Rivian would likely be approaching 100,000 vehicles per year in the early years of the plant, which should be fully operating by the end of next year. There’s also an as-yet-unnamed vehicle that Rivian and Ford Motor Co. plan to partner on that might run on the line.

Approaching 100,000 units annually so early on could be a boon for the startup, and help it avoid pitfalls that Tesla CEO Elon Musk encountered with his first three Tesla models. Tesla models don’t share many common parts. Rivian’s vehicles will share the most expensive and important components, including the battery and powertrain.

The scale offered by opening a plant that would be manufacturing multiple models in its first couple years will offer the capital Rivian needs to grow its business, Abuelsamid said. He and others have said it would be difficult for Rivian to sell enough of its consumer-targeted SUV and pickup to sustain the business.

The Amazon order is the largest order of a fully electric fleet to date. Alphabet Inc.’s Waymo has contracts to buy up to 62,000 Pacifica Hybrid minivans from Fiat Chrysler Automobiles, as well as 20,000 fully electric Jaguar I-Pace SUVs. The city of Sacramento has a fleet of 80 electric Chevrolet Bolts. United Parcel Service joined several companies in late 2017 to reserve Tesla semi-truck tractors, which have yet to be built.

Amazon CEO Jeff Bezos announced the Rivian deal at an event Thursday at the National Press Club in Washington, D.C., with a speech focused on addressing climate change. Rivian’s Mast told The Detroit News the vans would eliminate 4 million metric tons of carbon-dioxide emissions when the fleet is fully operational.

7 Responses to “Amazon’s Epic EV Order”

  1. leslie graham Says:

    “The startup is to build 100,000 electric vans for e-commerce giant Amazon.com Inc. over the next decade”

    Pathetic.

    Sorry – I know it’s a baby step in the right direction and blah blah blah but really – it’s just pathetic.

    • jimbills Says:

      If your saying that humans as a whole aren’t doing enough, absolutely that’s right.

      But some things about this particular story should be put in context. This is the largest EV bulk purchase to date. It’s likely to cover the majority of Amazon’s truck fleet (I can’t find exact numbers on their size). This is one company, and other companies are starting to make similar moves. It’s not Tesla – which is important, because it means there are other credible competitors to Tesla, which would increase the total number of EVs on the road.

      I’m not a believer in technology solving our environmental issues. I generally think technology powers economic growth, which fuels expansion, which continually worsens our impact in the environment. With energy production only (and not all the other sources of pollution, environmental destruction, and resource use), as we grow the need for all the types of energy also grows, and even older energy sources like fossil fuels will see, if not actual growth, then at least a serious prolonging of their use well into the future.

      This article goed into some of the issues there:
      Yale Environment 360: Why China’s Renewable Energy Transition Is Losing Momentum.
      https://e360.yale.edu/features/why-chinas-renewable-energy-transition-is-losing-momentum

      But, it’s also true that we are just at the beginning of the EV switch. I think a total transition will take longer than we can actually afford in terms of emissions. But, the start of the switch is happening, and we’re seeing signs that it could be a significant factor in the next decade. Here’s another one:
      https://www.cnbc.com/2019/09/26/first-gas-station-to-ditch-oil-for-electric-vehicle-charging-now-open.html

      • jimbills Says:

        To clarify: I’m not a believer in technology ‘alone’ solving our issues. There is such a thing as ‘cleaner’ technologies that overall have less of an environmental impact. EVs count (although not by as much as we should have). However, technology by itself in a capitalist economy fuels growth of that entire economy, which means: more mining, more forests chopped down, more land and resource use, more energy production (of all types), and so on. There have to be limits placed on these things by some other source – governmental regulations being preferable to economic crashes.

        • doldrom Says:

          Well said. We need to rethink our economic metrics, goals, and parameters. Not much of that going on. We are sticking to a model which requires infinite growth just in order not to crash, even though at the end of this road, we are going to crash into a wall. Everybody knows it. At the same time everybody realizes more or less that the quality of human life and happiness has only a tangential relationship with the more and more stuff model.

          I applaud Amazon’s move, even though I hate Amazon culture as a social and business innovation.

          What we really need is military order of magnitude spending on R&D and projects to transition our energy system before we run out of options. In line with the real threats we need to defend against.

          • rhymeswithgoalie Says:

            I see some advantages of e-tail over brick&mortar stores: Instead of members of individual households driving out to retail establishments and parking on large sheets of asphalt, online ordering allows for efficiencies in moving goods from warehouses to multiple front doors. Amazon has even added a feature which makes it easier to miscellaneous purchases into fewer packages.

            The downside, of course, is more boxes to put in the recycle bin. And, of course, while Amazon has been pressured to increase their wages, Bernie et al are still working to improve their labor practices and environment.

      • rhymeswithgoalie Says:

        FWIW, most of Amazon’s “truck fleet” is still UPS, FedEx, and USPS.


  2. Ther are so many good reasons for the enrergy trasition away from fossil fuels. Let’s do it!


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