Cox Automotive Inc.’s $350 million investment in Michigan-based automaker Rivian Automotive LLC is expected to bolster the electric vehicle maker’s retail and customer service programs—and hiring in its growing Irvine operations hub—as its market launch looms.
Cox Automotive, a business unit of Atlanta-based Cox Enterprises Inc., has a portfolio that includes car valuation firm Kelley Blue Book of Irvine—with some 500 workers based in the Spectrum, has been part of the fold since 2014—and Autotrader, giving it muscle when it comes to the ins and outs of the vehicle buying and selling process.
That operational expertise is key as Rivian readies for the launch of its first-ever vehicles next year.
Cox’s equity investment in Rivian—which gives it a seat on the Rivian board—adds to the more than $1.5 billion now invested into the electrical vehicle maker, following a $500 million investment from Ford Motor Co. and $700 million from Amazon.com earlier in the year.
Founder and Chief Executive RJ Scaringe said in an announcement on the Cox Automotive investment the focus is on an “ownership experience that matches the care and consideration that go into our vehicles.”
Scaringe went on to hail Rivian’s global footprint saying Rivian is to partner with Cox on “delivering a consistent customer experience across our various touchpoints.”
Cox Automotive’s portfolio of brands could come in handy for everything from inventory control and servicing logistics to retail and perhaps further out, if Rivian ever were to consider, subscription offerings, pointed out Tustin-based AutoPacific Inc. Vice President of Industry Analysis Ed Kim.
“I see the relationship between Cox and Rivian probably most valuable to Rivian on the back-end side, not the consumer side,” Kim said. “There’s just so much that goes on behind the scenes. Having that 800-pound gorilla’s expertise in all that certainly could help them a lot, not to mention the cash infusion.”
Job Push
Rivian, while headquartered in Michigan, has a broad footprint with research and development facilities in Irvine, San Jose, and Carson. Manufacturing is done out of Normal, Ill., with the U.K. serving as an engineering outpost.
The company has a roughly 20,000-square-foot location in the Irvine Spectrum area, which it uses to test and make batteries, electrical hardware, and vehicle control software. It opened the R&D facility about two years ago.
The automaker lists close to 80 open positions in Irvine, including a number of jobs related to battery making and engineering.
Rivian was started by Scaringe, a Massachusetts Institute of Technology graduate, in 2009. It has yet to release a vehicle to the market, but that’s expected to change next year.
“The last four years we’ve been really ramping up,” Rivian Director of Electrical Hardware Michael Hong told the Business Journal during last year’s Los Angeles Auto Show.
Rivian was the talk of the show when it pulled the wraps off its five-passenger pickup truck, the R1T, and the seven-passenger sport utility vehicle R1S. The handsome, Range Rover-esque designs are in line with how Rivian is positioning its brand in the marketplace as a maker of “adventure vehicles,” with aspirational marketing cooking up picturesque camping and mountain scenes.
Yet, the truck’s price points are about on par with typical fuel-powered pickups and SUVs in the market, which it expects to make it a compelling offer to consumers. The R1S has a starting price of $72,500, while the R1T starts at $69,000.
“We saw what Tesla accomplished back in 2012 with the Model S and obviously they have a ton of momentum built off that. They started small and gained a lot of traction, and I think the takeaway there is the auto industry is changing so rapidly there really are opportunities for start-up brands to come out of nowhere and disrupt the space,” Kim said.
“First impressions are that it’s [Rivian] really, on the surface, not overpriced relative to what the market is now charging. The pricing is pretty much in there with other well-equipped gasoline pickup trucks. The other important thing to note is the marketplace has been and continues to be gaga over pickups and SUVs. That’s not diminishing anytime soon. If anything, we’re continuing to track further market share growth relative to sedans, so Rivian does have products that really resonate with what many consumers in America want.”
Both models, which are advertised as being able to handle as many as 400 miles before having to recharge the battery, are currently available for pre-order.
Plans call for a rollout to the U.S. market late next year with a global expansion the following year.
