Rivian gets Mercedes assist in European market

Rivian has agreed to supply Amazon with 100,000 electric delivery vans by 2030.

Mercedes-Benz said in April that orders were full but its factories were suffering from supply chain problems.

Mercedes and Rivian plan to produce both models on a joint production line, with Mercedes said it is developing its own new all-electric van architecture called VAN.EA.

Under the new contract, the two companies will build two large vans. One is based on Mercedes’ VAN.EA platform and the other is based on Rivian’s light van electric platform.

They didn’t reveal the exact location.

Mercedes said it would reorganize its German plant that currently builds the larger Sprinter vans to offset rising costs of electric vehicles. As part of that transition, it will invest approximately $400 million in its Düsseldorf plant.

Mercedes also said it would use an “established plant” in Central or Eastern Europe as its third van production site after Düsseldorf and Ludwigsfelde in Germany.

The Mercedes plant in Kecskemet, Hungary, is likely on the factory shortlist.

Opened in 2012, the factory builds entry-level Mercedes A-Class, B-Class and C-Class cars. The automaker plans to reduce production of such cars and shift to more expensive models.

By 2025, all newly introduced Mercedes van models will be electric only.

Mercedes also has a partnership with Renault, which produces utility vehicle versions of the Kangoo, the Citan and T-Class compact vans. These vans also have a fully electric option. Mercedes’ midsize van Vito also has an electric version.

Bloomberg and Reuters contributed to this report