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PR & News Rivian lands $350 million investment from Cox Automotive

Zach Houseknecht

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Jul 24, 2019
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Rivian, the adventure-minded electric automaker that plans to produce a pickup truck and SUV, has raised $350 million from global automotive services company Cox Automotive .

The two companies said Tuesday they will also “explore partnership opportunities in service operations, logistics, and digital retailing.” Further details weren’t provided. However, a statement from Rivian founder and CEO RJ Scaringe suggests the partnership will help the EV startup provide services to its customers.

“We are building a Rivian ownership experience that matches the care and consideration that go into our vehicles,” Scaringe said. “As part of this, we are excited to work with Cox Automotive in delivering a consistent customer experience across our various touchpoints. Cox Automotive’s global footprint, service and logistics capabilities, and retail technology platform make them a great partner for us.”
- From TechCrunch

What do you all think? Between Amazon's investment and now COX Auto's - is this a long term play into direct to consumer sales? Or is it more along the lines of a true tech and customer experience partnership?
 
Unlike Tesla, I thought Rivian's business model had more to do with providing engineering resources to existing manufacturers than directly competing with them? Yes, they've designed their own vehicles but from what I know about them, they're not seeking to be a vertically integrated automaker like Tesla and don't view them as a competitor. I view the R1 more as a licensing play than a vehicle with meaningful sales numbers.

I see this nothing more than them wanting a seat at the table of a potential rocket ship. Speculating on the demise of the franchise model I think is way premature IMO.

The direct sales model falls apart when the production numbers get big. Tesla is a prime example (logistics nightmare, service nightmare, working capital issues). They were nearly insolvent when they couldn't record in transit vehicles in Q2.
 
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Hummm....

Well, this is interesting!!!

Amazon is ordering 100,000 Rivian electric delivery vans
https://www.autoblog.com/2019/09/19...YwVOEmuWEdaAkbvW1EkYgOESFBR48q-L2WubjKlUpF_1k

amazon-Rivian_2.jpg
 
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This hit my inbox this morning:

https://www.thetruthaboutcars.com/2...nt-in-rivian-speaks-volumes-about-the-future/

A short excerpt to digest before you give that link a full click:

Bark's Bite said:
.... when I read that Cox Automotive had invested $350 million into Rivian last week, my initial thoughts were, “Oh, there goes Cox burning some more cash,” and I mostly went about my day. However, a week later, I’m beginning to see that there are more wheels in motion than anybody on the outside realizes — and they will have a significant impact on the automotive marketplace in the years to come.


Before I dive in, It’s important to understand the typical dealer’s opinion of the 800-pound gorilla that is Cox Automotive. Many, if not most, dealers genuinely dislike dealing with Cox, but they feel that they don’t have any choice. Dealer.com is one of the four approved vendors for websites with both General Motors and Ford, and one of the few approved CDJR solutions for co-op SEM approval. vAuto is the only pricing software that most serious dealers even consider using. Manheim owns and operates the majority of the auctions in the country. And while Autotrader doesn’t work like it used to, most dealers are still afraid to cut off that lead source (yes, you are too a lead source, Autotrader) entirely. Working with any of these companies involves stroking a hefty check to the not-so-jolly giant in Atlanta that is Cox Automotive.

As a result, dealers have a million conspiracy theories about the algorithms on Autotrader and Kelley Blue Book when it comes to displaying inventory. Autotrader used to default to a “price high-low” result on any inventory search, but cars are now sorted by “relevance.” Despite many reassurances to the contrary, dealers insist that there is a way to buy your way to the top of the relevancy search. (You can buy a spotlight ad, which are less obviously “paid ads” than they used to be.) I have heard dealers say that Autotrader gives favorable placement to certain OEMs because they spend more on advertising, etc.

You'll need to click the link for the whole article.
 
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