(Bloomberg) — Rivian Automotive Inc. fell the most since mid-November after Amazon.com Inc., one of its biggest backers and customers, agreed to buy battery-electric delivery vans from rival automaker Stellantis NV.
Most Read from Bloomberg
The first vehicles under the new order are due next year, Stellantis said Wednesday. It didn’t disclose the size of the deal, but Chief Executive Officer Carlos Tavares said the order was a “significant number.”
Read more: Amazon, Stellantis team up on software, delivery vehicles
The development is a threat to Rivian, which has been seen as a front-runner in a large pack of EV startups chasing market incumbent Tesla Inc., in part because of the backing of Amazon. The tech giant in 2019 ordered 100,000 electric delivery vans from Rivian, the first 10,000 of which are due by the end of this year.
Rivian said Wednesday that its deal with Amazon remains “intact, thriving and growing,” and called the latest development beneficial for the industry.
“Large fleets focused on electrification and carbon neutrality represent a win for the mission” of Rivian and Amazon, the EV firm said in an emailed statement. “Amazon’s scale is globally unprecedented, and we expect them to purchase vehicles from many providers.”
Amazon issued a statement hours after the Stellantis deal was announced that echoed those comments, saying it had always intended to work with multiple providers of electric delivery vans. “We continue to be excited about our relationship with Rivian, and this doesn’t change anything about our investment, collaboration, or order size and timing.”
Shares of Irvine, California-based Rivian tumbled 11% to $90.01, the biggest drop since Nov. 18, about a week after its initial public offering. Stellantis’s U.S. shares rose by less than 1%. U.S. electric vehicle companies fell for a second day amid signs of deepening competition in the sector.
The decline adds to Rivian’s recent slide after the stock briefly topped $100 billion in market value — at the time more valuable than Ford Motor Co., also an investor, and General Motors Co. — following its November listing. As of Wednesday’s close, Rivian’s market capitalization was $81 billion.
According to Rivian’s Oct. 1 regulatory filing, the e-commerce giant has exclusive rights to Rivian’s vans for four years, from the point of delivery of the first unit. Deliveries commenced in December. Amazon has right of first refusal to any vans built for an additional two years after that.
Read more: Rivian details $1 billion loss, Amazon deal in IPO filing
However, the terms of the deal outlined in the filing allow Amazon to work with other automakers on electric delivery vans.
Most Read from Bloomberg Businessweek
©2022 Bloomberg L.P.