Shares of Rivian (NASDAQ:RIVN) stock opened in the green today after wireless carrier AT&T (NYSE:T) announced that it had signed an agreement with the electric vehicle (EV) company for pilot vehicles. AT&T will receive pilot electric delivery vans (EDVs) and R1 vehicles starting in 2024 to gauge for cost and safety improvements, as well as carbon footprint reduction measures.
The financial terms of the agreement and the number of pilot vehicles that AT&T will acquire have not been immediately disclosed.
“This pilot is another important step in our ongoing efforts toward sustainability, reducing our carbon footprint and embracing a cleaner future for our operations,” said AT&T Connected Solutions Senior Vice President Hardmon Williams. “With advanced connectivity and a vision for a sustainable future, Rivian is setting the standard for the evolving demands of modern transportation.”
RIVN Stock: AT&T Signs Pilot Purchase Agreement
AT&T has placed a heavy emphasis on clean energy and has a goal of becoming carbon neutral by 2035. To help achieve this, the company is utilizing EVs, route optimization and artificial intelligence (AI). The company is also the exclusive provider of connectivity for Rivian vehicles, allowing for smooth over-the-air (OTA) software updates.
Last month, Rivian ended its exclusivity deal with Amazon (NASDAQ:AMZN) in regards to its EDV. This opened up the door for Rivian to sell its EDV to other parties, with AT&T being the first reported customer. Rivian has still committed to delivering 100,000 EDVs to the e-commerce giant by 2030. As of October, Amazon had over 10,000 Rivian EDVs on the road, which was “on the low end of a range Amazon had communicated earlier to the auto maker.”
Furthermore, there could be more EDV deals for Rivian on the way. In November, the company disclosed that it was in discussions with other potential customers, although it did not reveal specific names.
In other news, another hot topic is the potential unionization of Rivian employees. Last week, the United Auto Workers (UAW) union announced that it had initiated “synchronized campaigns” among 13 automotive manufacturers, including Rivian. If successful, this would benefit Rivian’s employees but also have the potential of hampering profitability and margin efforts.
On the date of publication, Eddie Pan held a long position in AMZN. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
