The Blue Oval seems to have lost a little faith in RJ Scaringe.
As you may well know by now, Ford has a pretty sizable investment in EV manufacturer Rivian. The relationship has been, to put it mildly, a bit tumultuous. The two brand's EV project was put to bed back in November, but Ford has maintained its financial stake in Rivian despite some controversy coming out of CEO RJ Scaringe's stable. Scaringe has previously said favoritism has made getting chips difficult and cites that as the reason for the brand's production woes.
We previously reported that Ford won't be selling that stake in Rivian despite these issues back in February, but that could now be changing. As of now, Ford's stake in Rivian is worth north of $8 billion, a fair bit more than the brand's initial $1.2 billion investment in Scaringe and Co. Now, the makers of the Rivian R1T might be losing that Dearborn backing.
A source reported to CNBC that Ford is going to sell 8 million of its shares in Rivian Automotive. Right now, Ford owns 102 million shares in Scargine's company. However, the transaction will only take place once a lockup for Rivian stock expires this Sunday. As of this article's publishing, the shares have not been sold. Additionally, a statement has not yet been issued by Ford.
For those on the outs of stock trading terminology, a lockup is a period of time after a company like Rivian goes public- which it did on November 10th- when investors like Ford can no longer sell their shares. Essentially, this helps to make sure the initial public offering of a company goes smoothly, and that no one backs out in the process.
CNBC also reported that JPMorgan Chase is going to dump around 13-15 million shares to an as-yet-unnamed seller. As of now, this spells bad news for Rivian. The brand has struggled to meet demand, like so many others, as a result of supply chain shortages. There's also been a good deal of controversy resulting from a shift in pricing for cars like the Rivian R1S- the brand's first SUV.
What these sales will spell for the future of Rivian is unclear. Demand for the company's products is incredibly high, but so are levels of concern at the brand's ability to deliver. We've seen several R1Ts sell for big money online, but that doesn't mean most consumers are willing to pay such prices for one off the factory line.
Join The Discussion