Ford Authority

Ford CEO Jim Farley Says Rivian’s Van Strategy Is Flawed

While the electric vehicle market has grown over the past couple of years as a whole, EV vans represent a pretty enticing segment for automakers, given their promise of lower operating costs for commercial customers. The Ford E-Transit, for example, quickly seized the sales lead in that segment, even though The Blue Oval isn’t pushing its fleet customers toward electrification, for precisely that reason, coupled with the extensive Ford Pro suite of software. However, while Ford CEO Jim Farley is quite pleased with his company’s van strategy at the moment, it seems as if he has some reservations about the way Rivian – an automaker FoMoCo has financially backed in the past – is handling its own strategy in that segment, according to the Detroit Free Press.

“Rivian has one customer. Amazon,” Jim Farley said when asked about the company’s van strategy at the automaker’s 2023 Capital Markets Day presentation. “Rivian only has a van for delivery. 95 percent of the commercial industry is small-medium sized business with like 1,000 different locations. Last-product-delivery is like tiny, tiny. … I mean, FedEx, UPS, they’re great. But I want the plumber who’s got five vans. They don’t have a fleet manager. Everything is super confusing to them. They don’t even have time for the vehicles to go to a dealer and schedule it. They’re really underserved. The big fleets are overserved. They can do it all themselves. They’re huge.”

“I always told (Rivian CEO) RJ (Scaringe), ‘Are you sure you want to bet on Amazon? Don’t you want to go after all the real customers?’ But, that’s what he decided to do,” Farley added. “Rivian and the reality of the commercial business couldn’t be more different. Also, most commercial customers aren’t going electric.”

Rivian has explored adding additional EV vans to its lineup via a partnership with Mercedes-Benz – an idea it ultimately scrapped – as well as potentially seeking out more customers for its existing product aside from Amazon, which it has an exclusive contract with at the moment. As Ford Authority reported back in March, Amazon and Rivian are reportedly talking about scrapping their deal after the former’s sales-related budget cuts resulted in it purchasing fewer vans than previously expected.

We’ll have more on everything Ford’s competition is up to soon, so be sure and subscribe to Ford Authority for the latest Ford Transit news and non-stop Ford news coverage.

Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.

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  1. David Dickinson II

    Rivian only having Amazon as a client tells me that Rivian has no desire to grow into a real company. They want to get their one big client, and then just sell the company. It’s an all or nothing bet, while a number of people suck down a pay package that they are funneling from investor money.

    1. Larry D

      Landing and focusing on Amazon is a great first start. Amazon is now the largest logistics company period. And I don’t mean in the US I mean the world. They are dominating so well that internally FedEx has stopped calling UPS their largest competition and switched that with Amazon. Sealing a contract to get even half of amazons current delivery fleet would set rivian up for a reliable fixed income for years while they grow.
      They also completed the ink on a non exclusive contract with amazon so they can now start selling vans to others including small fleet. The CEO showed off the new color scheme of an all white van with yellow branding for the occasion last week. This is in Amazons interest as well, they own a non controlling 1/5th of the company at 19.8%

  2. marin

    I like Jim Farley, actually, i like him a lot. He’s obviously a capable guy and a real car guy but some times he should just shut up… Elon can’t keep his mouth shut either but it seems to be working for him. He gets away with it… I don’t think too many others can pull it off.

  3. steve

    The Rivian van is so ugly it should not be on the street. No style what so ever. I guess you can get a full sun tan thru that 6 foot tall window

  4. Kriger

    So as someone who has over 20 of the Rivian EV vans in their fleet I can tell you from first hand real world experience that they are completely half baked, if even that. At 2k miles most have had to get new CV axles replaced. The trim (interior and exterior) falling off. As a fleet manager we aren’t allowed to keep anything in hand such as tires. If there is a flat in the morning I have to put a ticket in with Rivian that van is down for at least that day, and hope they make it out within two days. Our Transits, Sprinters, and Promasters all have tires on rim ready to swap at a moments notice. Windshield replacement? Has to go into a Rivian service center for likely a week. Mechanically they are garbage and Amazon gives us zero choice in using them. At any one moment half of ours are down for build issues.

  5. Bob B.

    BrightDrop is the one to watch.


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