Amazon’s Deal with Stellantis Puts Rivian Stock Under Pressure, RIVN Down 11%

Tech giant Amazon.com Inc (NASDAQ: AMZN) continues to further its ambitions in the electric car market by offering its cloud and software services. On Wednesday, January 5, Amazon announced its partnership with Stellantis for offering in-car dashboard software services. This news had a negative impact on Rivian Automotive Inc (NASDAQ: RIVN) stock.

Besides, Amazon will also be one of the first commercial customers of Stellantis for its electric vehicle slated to launch in early 2023. Stellantis, formerly fiat Chrysler, has already delivered tens of thousands of vehicles to Amazon since 2018. As a result, it has developed its upcoming Ram ProMaster electric vehicle taking inputs from Amazon.

As part of the latest partnership, Amazon and Stellantis will work together on STLA SmartCockpit software. According to the official statement, this will appear in millions of vehicles starting in 2024 as part of a multi-year cloud deal.

The service will also incorporate a ton of features like Amazon voice assistant Alexa, maintenance, e-commerce, navigation, and other elements. Stellantis looks keen on moving its vehicle data pipeline to a cloud-based system. Thus, Amazon Web Services will become its preferred cloud provider for vehicle platforms.

The Amazon cloud business and AWS is putting greater focus on the automobile software offerings recently. Back in November 2021, the tech giant unveiled AWS IoT FleetWise, tool automakers can use to store and refine vehicle data.

Amazon – Stellantis Deal Puts Pressure on Rivian Stock

The recent collaboration between Amazon and Stellantis has come in just two months’ time of Amazon-backed electric vehicle maker Rivian debuting on Nasdaq in November 2021. Amazon already has a contract with Rivian for making 100,000 vehicles by 2030 for the e-commerce giant.

However, Wednesday’s news was enough to put major pressure on Rivian’s share which corrected 11%. On Wednesday, Rivian (NASDAQ: RIVN) stock corrected 11.22% ending the trading at $90.01 levels. On the other hand, the Stellantis shares have surged by 0.3%. Speaking of this development to CNBC, Amazon spokesperson said:

“We always knew that our ambitious sustainability goals in our last mile operations would require multiple electric delivery van providers. 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.”

While Rivian made a strong debut on Wall Street, it faced challenges with battery charging and performance during the initial tests.