Ford Motor Co. and Rivian Automotive Inc. have decided to go their separate ways rather than collaborate on future electric vehicles, backing away from an earlier strategic pact that led to a multibillion-dollar windfall for Ford.
Executives from both companies last week decided to scrap plans for a specific electric vehicle, a Ford spokesman said.
The auto makers mutually decided to focus on their own projects, scrapping plans to jointly develop a new model as had been envisioned under a partnership struck in early 2019, representatives from each company said.
"Ford remains an investor and ally on our shared path to an electrified future," Rivian said. The Ford spokesman said: "Both their EV development and ours have advanced to a significant degree" since the original deal was formed, giving each company more confidence to move ahead independently.
Trade publication Automotive News earlier reported Ford's decision to end the co-development plans, citing comments from Ford chief executive Jim Farley during an interview.
The change of plans comes after Rivian made its debut on the public markets this month, with a blockbuster IPO that raised about $13.7 billion.
Investors have since piled into the stock, pushing Rivian's valuation past that of both Ford and larger rival General Motors Co. As of Friday's close, the company was worth about $113 billion. Ford's market value was about $77.5 billion.
There already were signs that the strategic aspect of the agreement between the companies had faded since the deal was outlined in April 2019, which included a $500 million investment by Ford into the startup.
Ford in early 2020 canceled plans for a different model, one for Ford's Lincoln luxury brand, that would have been built using Rivian's technology, citing cash concerns amid the onset of the pandemic. Last spring, Ford's representative on Rivian's board stepped down.
Ford's early investment and subsequent infusions into Rivian gave Ford a 12% stake in Rivian, worth about $13.5 billion as of Friday's close.
Mr. Farley, who took the top job in October 2020, has accelerated Ford's electric-vehicle push. The Dearborn, Michigan-based auto maker plans to release a battery-powered pickup in the spring that would compete directly with Rivian's own electric truck, the R1T.
Mr. Farley told Automotive News the decision to drop joint development plans with Rivian was made in part because of Ford's growing confidence in its own electric-vehicle strategy.
Ben Foldy contributed to this article.
