LNG: TESLARATI

Yesterday, Elon Musk posted a cryptic tweet asking the Twitterverse about the possibility of Tesla establishing a Giga Texas facility. The response was overwhelmingly positive, despite some Tesla supporters questioning the rationale behind the notion of investing in a state that has been practically hostile to the company. Yet Tesla’s upcoming lineup of vehicles, particularly its Cybertruck, the addition of Giga Texas to the company’s growing list of factories may very well be a godsend. It could, for one, address the Cybertruck’s “Cowboy Problem” in Texas. 

Texas is a large market for pickup trucks. Pickups are so popular in the Lone Star state that the automotive auctioneering firm Mecum did not even bother including sedans and other cars in its auction in Houston last year. Texas accounts for about one of every six pickups sold in the United States. Considering that trucks are among the most popular vehicles in the country, this number is very substantial. This is a goldmine that disruptive all-electric companies like Tesla can tap into, provided their vehicles are embraced by consumers. 

In a recent article, author David Freedman noted that real truck buyers primarily worship a vehicle’s specs and utility when considering their next purchase. This is the reason why workhorses such as the Ford F-150 have become such a juggernaut in the United States auto market, and in Texas in particular. Former GM executive Tony Posawatz, who was behind the Chevy Volt, highlighted this in a statement. “Truck buyers are more sophisticated than car buyers in what they’re looking for. They look at their truck as a tool,” he said. 

Tesla and its Cybertruck team appear to be fully aware of this, as evidenced by the vehicle’s features and specs, many of which seemed to have been included following CEO Elon Musk’s brainstorming session with his followers on Twitter. From hauling capacity to sheer unadulterated power, the Cybertruck has it all. The vehicle even offers a range of over 500 miles per charge in its sub-$70,000 configuration, something that is yet to be matched by other upcoming EV truck makers like Rivian. The Cybertruck is designed to take an immense amount of punishment without flinching as well, thanks to its stainless steel exoskeleton. 

Its controversial looks aside, the Cybertruck objectively has the features and specs that can make it a massive disruptor in the EV segment. Yet there are psychological barriers that work against the vehicle’s favor, and one of them may very well be Tesla’s reputation as a California-bred, Silicon Valley-based company that makes sleek, futuristic cars. Simply put, Tesla does not have the reputation of a car maker that can produce tough vehicles for work. Ford, GM, and other veteran automakers do, and they could be counting on this for their own upcoming electric trucks. 

Gabriel Smart of Planet Ford in Houston, which primarily sells trucks, describes the automaker’s pitch for its F-150. “When someone comes in for a Ford truck, it’s because that’s what their buddy drives, it’s what their dad drives, it’s what their granddad drives. So that’s what they want to drive, too,” he said. Tesla, then, has a challenge ahead of it. The company would not only have to buck the stereotypes of electric vehicles with the Cybertruck; it would also have to prove to dedicated truck buyers that its all-electric pickup is a serious alternative to tried and tested vehicles such as the F-150. 

One of the ways that the company can do this is to simply make the Cybertruck as the de facto electric vehicle of Texas by producing the truck right in the state itself. If Giga Texas does pan out, and if the facility ends up producing vehicles like the Cybertruck, it would be very difficult for Texas’ regulators and truck buyers to not support the vehicle. The Cybertruck is already compelling enough with its specs, features, and price alone. Add the fact that it is built using American labor at the heart of pickup country, and the vehicle may very well become the symbol of the US’ next-generation of trucking. This, ultimately, solves any possible “Cowboy Problem” Tesla may have with its all-electric pickup, and it may open up the state to more of the company’s vehicles as well. 

Elon Musk noted during the fourth-quarter earnings call that the demand for the Cybertruck has been impressive so far, with the company getting enough orders to correspond to several years’ worth of production. “I have never seen actually such a level of demand as this — we’ve never seen anything like it basically. I think we will make as many as we can sell for many years. So — as many — we’ll sell as many as we can make, it’s going to be pretty nuts,” Musk said. And this is all before the Cybertruck can even tap into the heart of the US’ pickup market. 

The Cybertruck is expected to enter the market next year. Tesla plans to start with the tri-motor AWD and dual motor AWD. The $39,990 single motor RWD Cybertruck, which undercuts competitors such as the Rivian R1T, is expected to start production in late 2022.

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Update: In a Twitter response to this article, SpaceX CEO Elon Musk says that the reality of things is unsurprisingly a bit more complex. As noted, the standards and requirements for aerospace hardware are much stricter than those needed for the water towers, storage tanks, and other utilities that existing commercial solutions are commonly used to build.

As such, it’s inaccurate to suggest that those off-the-shelf solutions are capable of building rockets right out of the box. Still, several pieces of commercial fabrication equipment from providers like IMCAR have been spotted in use at SpaceX’s Boca Chica, Texas Starship facilities. With “substantial capital and engineering” investments into making those solutions more precise, however, SpaceX may still be able to use existing hardware – or at least the concepts they underly – to rapidly build high-quality Starships and Super Heavy boosters.

A SpaceX engineer says that the company wants to adopt commercially-available manufacturing equipment that could allow its Boca Chica, Texas team to build Starship tank parts in minutes and nearly-complete rocket bodies in a matter of days.

Originally created to meet the needs of a variety of different companies – typically oil and gas related – that need efficient, affordable, and standardized storage tanks, a small but growing niche exists for semi-automated tank production. While there is some clear uncertainty given that the quality and consistency required for oil and gas needs or even simple water storage likely isn’t the same needed to meet strict spaceflight margins, SpaceX has already acquired several production tools from existing contractors and is working around the clock to prove that those same tools can be used to build large, reusable rockets.

The gamble is simple: if it turns out that off-the-shelf (COTS) equipment can become an almost turnkey solution for manufacturing high-quality Starship spacecraft and Super Heavy boosters, SpaceX may have found a shortcut to orbit, avoiding the huge expense of finding and building its own custom production solutions. But is that COTS tank fabrication hardware truly up to the task?

At least right now, the simple answer is “yes”. Thanks to two highly successful destructive tests of Starship tank prototypes that wrapped up last month, SpaceX has confirmed that at least a subset of the available COTS solutions can be used to build Starships (theoretically) capable of orbital flight. To be clear, those tanks reached only the most basic kind of specification needed for a true orbital-class spacecraft, demonstrating that they can fairly easily survive the pressures required for Starship and its Super Heavy boosters to remain structurally sound from liftoff to touchdown.

For the most part, the only truly COTS aspect of those test tanks were the flat, cylindrical rings at their center – produced by cutting and welding together giant sheets of coiled steel. The tanks’ domes were more or less welded together by hand with the help of large jigs, while finished domes and rings were also welded together by hand. Given that the welds used to create the rings themselves have never obviously been a problem, the success of Starship’s two test tanks can thus be heavily attributed to skilled welders’ hands rather than any particular off-the-shelf solution.

Still, the fact of the matter is that automatic solutions like those currently available exist for good reason – aside from requiring far less labor to produce similar results, the consistency and quality of those results can actually be much better than anything that can be reliably achieved in a more boutique fashion. This is, at least, the promise of solutions like those shown below.

SpaceX certainly appears to be pursuing the best-case scenarios that could be made possible with some of the hardware shown above. Already, it looks like Starship ring segments – themselves formed and welded with semi-automated IMCAR hardware – are being stacked and tack welded (temporary welds used like clamps) inside one of SpaceX’s new tents before the stand holding those ring(s) rotates itself, automatically welding them together.

The three mated rings pictured above were assembled over the course of several days using some of those methods and COTS fabrication hardware. However, if SpaceX can refine its procedures – currently still in the oven, so to speak – and become an expert at modifying and using available tank fabrication hardware to fabricate rockets, the company could conceivably build entire Starship and Super Heavy bodies in a matter of days.

It might take a substantial amount of trial and error, but SpaceX is clearly well on its way.

Check out Teslarati’s newsletters for prompt updates, on-the-ground perspectives, and unique glimpses of SpaceX’s rocket launch and recovery processes.

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SpaceX chief and founder Elon Musk attended the company’s Career Day at the Boca Chica facility in Texas on Thursday. Musk was seen at the Stargate building talking to local news outlets and speaking with a few job seekers in attendance.

Twitter user @MartePaa shares a video of the SpaceX chief responding to him saying, “Don’t doubt your vibe,” referring to Musk’s new EDM single that just made it to the Top 10 on Soundcloud. Musk responds to him saying, “Every now and again, I doubt my vibe. So now, like, that was a mistake,” before walking away as the lively tunes of a mariachi band play in the background.

Went to career day at space x and when I was walking out the interview
I told @elonmusk “Dont doubt your vibe” lmao 😂
Then he said “every now and again I doubt my vibe…so now like…that was a mistake”
What in the world 🌎 pic.twitter.com/yQLcmLuzQu

— Supreme Martématics (@MartePaa) February 7, 2020

Local news outlets and other attendees have also shared images of Musk giving an interview to the local media during the job fair.

Elon Musk at #UTRGV Stargate/SpaceX – Boca Chica Texas.#Brownsville RGV #Jobs Careers
Photo by: De La Fuente Pedro
for https://t.co/rDNGWOke82 pic.twitter.com/rluCX5uIFy

— RGV.com™ (@rgv_com) February 7, 2020

LMFAO BRO I DONT BELIEVE IT 😂😂 pic.twitter.com/WjKsRycqVQ

— 🌴🇲🇽 (@SnagGodHN) February 7, 2020

When Elon Musk founded SpaceX in 2002, the aerospace company had nothing more than a carpet and a mariachi band. Now, almost two decades after SpaceX was launched, a sizeable crowd of hopefuls who want to become part of the production crew that assembles SpaceX’s next-generation rocket that will send people to the moon and Mars has shown up.

The job fair appears to have had an incredible turnout, as can be seen in Twitter user @SpacePadreIsle’s video of a long line of applicants snaking outside the Stargate building. The video also shows SpaceX paying tribute to its humble beginnings—and appeasing its CEO’s affinity for many things Mexican—by playing mariachi music over loudspeakers.

Job fair at #SpaceX #BocaChica 🚀 🎶 pic.twitter.com/gLKdTifhCw

— SPadre (@SpacePadreIsle) February 6, 2020

It’s no secret that Musk is a dancing kind of guy. He wasn’t averse to making more than a few moves at the launch of the Made-in-China Model 3 in Giga Shanghai, so it’s no wonder why the SpaceX chief has a certain penchant for the festive, lively tunes of mariachi music.

All we had back then was carpet & a mariachi band. Now, SPACESHIP!! https://t.co/jYECRWMz5M

— Elon Musk (@elonmusk) January 28, 2019

He has, in fact, shown a liking for many things coming from beyond the southern border. In 2018, Musk even patented Teslaquila, his version of the popular Mexican spirit given the Tesla brand.

At present, the SpaceX chief is focused on the construction and assembly of Starship, the new rocket that is intended to fly humanity into deep space. Earlier this week, Musk announced on Twitter that SpaceX will be holding a career day at its Boca Chica facility, with the goal of hiring full-time production staff that can cover four shifts for round-the-clock operations. Musk said he will be at the event himself.

SpaceX also filed an application with the FCC seeking permission to use radio frequencies to communicate with the Starship SN1 prototype on a planned test flight dated for any time between March 16 and September 16.

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Tesla reduced the number of injuries within the production lines in its Fremont plant. The company released a blog post stating the number of incidents that harmed workers was reduced by more than 50% in 2019 compared to 2018.

Statistics shared by the company stated the decrease in the number of injuries was due to preventative measures meant to reduce the frequency of accidents happening within the plant. Tesla states that 2019 was one of its safest years as a company within its Fremont facility where rumors have circulated that safety violations were at an all-time high in 2018, according to an article from Forbes.

The California Division of Occupational Safety and Health (Cal/OSHA) confirmed Tesla’s claim that it reduced injuries in its Fremont plant by more than half the amount compared to the previous year. Cal/OSHA stated that Tesla’s safety record-keeping is 99% accurate, and the company maintains that the data on injuries is critical for identifying and preventing future risks from occurring.

Employees at the Fremont plant also spent less time away from work in 2019 because of injuries or illnesses. Tesla reports their Days Away and Restricted Time, or DART, improved by 12% compared to the year before. This could be a key indicator behind the increased production rates and improved build quality of vehicles that Tesla customers have reported over the past year.

“People, our most important asset, are at the top of our accomplishments. Our employee safety engagement program, which we expanded to manufacturing sites globally, encourages employees to think and talk about safety every day. The program leverages the brainpower of our employees—from production associates to engineers—to continuously improve processes and ensure our safety culture is the best in the world,” the blog post stated.

The company is also assisting other automakers to improve safety within production plants across the world. In 2019, Tesla hosted an automotive safety forum with over 100 safety professions from some of the world’s biggest car manufacturers. Representatives from Subaru, Volkswagen, Honda, Toyota, and more were in attendance to share practices and ideas to create safer work environments for employees who are responsible for building safe modes of transportation for the average human being to use.

This year, Tesla wants to improve even more by offering physical and mental health evaluations for its employees. In addition to these services, Fremont, Gigafactory 1 in Nevada, and Gigafactory 3 in Shanghai will all receive their own on-site medical clinics so employees can be treated in a fast and efficient manner in the event of an injury.

Tesla is creating a culture of safety throughout its facilities and on the road. The aim of driving a Tesla vehicle is not only to offer the driver a fun experience through industry-leading performance and technology but to also make them feel safe and secure if an accident was to occur. Meanwhile, in the production facilities, the company is taking every step possible to prevent injuries from occurring so employees can focus on the ramping its production numbers.

You can read Tesla’s blog post here.

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Lucid Motors and Volkswagen Auto Group CEOs Peter Rawlinson and Herbert Diess recently expressed their support towards Tesla and Elon Musk. The two automotive executives took particular note of Tesla’s growing lead in the electric car segment.

“There’s a recognition that Tesla is in a preeminent position in terms of EV technology,” Lucid Motors CEO Peter Rawlinson said at the BloombergNEF Summit. Rawlinson stated that Tesla’s lead in the EV sector is actually growing since the company continues to improve its already industry-leading products.

“They’re even further ahead than has been reported, and I think the gap is widening, not closing,” Rawlinson added.

This is a change in tune from Rawlinson as he was not always a firm supporter of Tesla, especially after he left the company. Before joining Lucid Motors, Rawlinson served as one of the chief engineers of Tesla’s flagship sedan, the Model S. In 2018, he spoke about Tesla’s lack of “truly luxury” features, arguing that the electric vehicles are “premium and high-tech, but not luxury.”

Tesla holds a considerable lead in the electric vehicle market, especially in terms of range and performance. This particular combination has eluded traditional carmakers who are dipping their feet into EVs so far. The Porsche Taycan Turbo, for example, knocks it out of the park with its classic sports car performance. But when it comes to range, the vehicle earned a paltry rating of 201 miles from the EPA.

Indeed, Tesla’s lead in electric vehicles is something that’s becoming undeniable. It’s not only the Lucid Motors CEO that seems to be open enough to admit this, either.

Volkswagen AG CEO Herbert Diess has been vocal of his support of both Tesla and Musk in the past. After Musk announced his company’s plan to create a production plant in Germany while receiving an award for the Model 3, Diess was supportive of Musk. “I know all of this competition here in Germany, this award, it’s a great achievement,” Diess stated.

When Tesla’s value eclipsed Volkswagen’s by nearly $50 billion, Diess was nothing but supportive. Diess stated that he believes cars will eventually surpass the cell phone as “the most important mobile device” and Tesla’s technology is a key contributor to that idea. “If we see that, then we also understand why Tesla is so valuable from the view of analysts,” the VW CEO said.

Tesla stock has skyrocketed over the past three months. The price per stock at the closing bell on February 4 was $887.06, a new all-time-high for the company. Tesla’s technology has been a key to the company’s success, and based on Rawlinson and Diess recent statements, it appears that other automakers are starting to recognize the hard work Tesla has dedicated in the development of its core technologies.

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Elon Musk is pondering on building a Gigafactory in Texas and the CEO wants to find out what the electric car community on Twitter thinks of the possible next big move for the electric carmaker. Musk started a poll late Tuesday night and gave the Twitterverse two options: “Hell yeah” and “Nope.” As of writing, the poll has garnered almost 231,000 votes with around 80% of respondents being in favor of building the new Gigafactory in the Lone Star state.

Giga Texas would be Tesla’s fifth Gigafactory, and while many believe the nomenclature is perfect for the state where everything is bigger, many are wondering why Musk would consider building a factory in a state where the direct sale of its vehicles is not allowed. A bill was even pushed once to prohibit the electric car manufacturer from servicing its vehicles in the state.

Giga Texas?

— Elon Musk (@elonmusk) February 5, 2020

Tesla has Giga Nevada and Giga New York in the United States. The former is focused on producing batteries for the car manufacturer while the latter produces the Solarglass Roof Tiles and Powerwall. There’s also Giga Shanghai in China that already produces the Model 3 for the biggest automotive market in the world. The Silicon Valley-based carmaker is also hoping to lay the first brick by mid-March of its planned EV factory in Europe, Giga Berlin.

During the Q4 2019 earnings call, Musk explained that Tesla needs to make sure it has the batteries to make cars that are already on its lineup. “We got to scale battery production to crazy levels that people cannot even fathom today. That’s the real problem,” the chief executive of Tesla said.

Giga Texas might be the solution to this problem. It can also be the perfect place to ramp the production of the Cybertruck, whose Tri-Motor version is set to hit production by 2021. With Giga Texas, the Fremont factory will not have to handle additional pressure as it already produces the Model S, Model X, Model 3, and the much-awaited Model Y crossover. Ultimately, penetrating Texas is setting foot in the heart of the country’s biggest oil producers and refineries, and that’s quite a statement for Tesla.

We are (obviously) also looking for world-class chip designers to join our team, based in both Palo Alto & Austin

— Elon Musk (@elonmusk) February 2, 2020

It should be noted that Texas has a lively tech scene, particularly in Austin. Tech talents from Silicon Valley have been flocking to this region. The blossoming tech scene in the metro is blossoming enough that people call Austin as “Silicon Hills.”

Earlier this week, Elon Musk announced via Twitter that he will be hosting an AI hackathon party at his house. This time-boxed event is most likely to further accelerate the development of Tesla’s Full Self-Driving capabilities and improvements to its Autopilot feature. It is also a perfect setup to fish for new talents that will join Tesla’s workforce. Interestingly enough, Musk mentioned in his hackathon announcement that the electric car maker was looking for chip designers who can join the team in Palo Alto and Austin.

Even without waiting for the Giga Texas poll to end, the Twitterverse and Elon Musk’s 31 million followers may have already an obvious decision. For sure, everyone is eager to hear additional details about the new Gigafactory Musk is planning to build, as well as the role Giga Texas will play Tesla’s efforts to transition the transportation towards sustainability.

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As the novel coronavirus outbreak continues in China, Tesla has opted to postpone MIC Model 3 deliveries scheduled for February, at least until the situation in the country improves. The update was related by Tesla China VP for External Affairs Grace Tao Lin, who noted on Weibo that MIC Model 3 deliveries will likely be pushed back, perhaps as far back as the third quarter of 2020.

Giga Shanghai currently has a run rate of 3,000 Model 3s per week and is poised to hit an annual production rate of 150,000 vehicles. The company has also launched the Model Y program in the country. With these in mind, the recently-announced delays will likely set back the ramp of the locally-made Model 3, while potentially pushing back the Model Y program in the country.

Interestingly enough, Tesla has noted that it does not expect a big financial hit in China due to the coronavirus outbreak. This is because the MIC Model 3 only represents a small fraction of the company’s quarterly profits, according to Tesla’s finance chief Zach Kirkhorn during the company’s Q4 2019 earnings call.

Analysts currently expect markets to underperform because of the ongoing coronavirus outbreak. However, Tesla seems to be defying the odds so far. This week, the Tesla stock continued to soar, with the Silicon Valley-based electric carmaker surpassing the current valuation of Volkswagen and BMW combined on Monday. Tesla’s price per share hit past $900 and settled at $887.06 when the market closed on Tuesday

The real impact of production delays and supply chain issues might be felt soon though if the closure of factories across China will be stretched to mid-March. Automotive research firm IHS Markit estimates that carmakers may lose about 1.7 million units during the first quarter of 2020. This corresponds to a 32.3% decline from the firm’s initial estimates.

“In this scenario, we might expect the potential of a China-wide supply chain disruption caused by parts shortages from Hubei, a major component hub — and adjacent province closures for the majority of the month of February as a result,” IHS Markit wrote in a press release.

The Shanghai government has ordered the shutdown of companies in the city, including Giga Shanghai, amid the coronavirus outbreak. Government and private companies are not allowed to resume operations before Feb. 9. Prior to the suspension of work, the government has also extended the Lunar New Year holidays to help control the spread of the 2019-nCOV that started in Wuhan, a city about 9 hours away by car from Shanghai.

Tesla is not the sole automaker that is being affected by the ongoing outbreak. Hyundai, Toyota, Ford, Nissan, Volkswagen, Daimler, and Continental have also shut down their respective factories in China due to the virus.

Based on the latest updates, there are more than 24,000 people infected by the coronavirus that causes fever, serious respiratory illness, impaired liver function, and kidney failure. As of Wednesday local time, there have been 490 deaths reported in connection to the virus. The World Health Organization has declared the outbreak, which has infected people in 25 countries, a public health emergency. The United States and several countries have also implemented travel bans to and from China.

In response to the coronavirus outbreak, Tesla China has offered local customers free Supercharging for an indefinite time to make traveling easier for drivers who reside in areas affected by the outbreak.

Amid the public health scare, Tesla has continued to provide customer support through Douyin, China’s version of TikTok. Tesla sales staff from certain experience centers live-streamed tours of the Made-in-China Model 3 and entertained questions from potential buyers. The company has also posted schedules of the live streams that interested consumers can join via Douyin.

Meanwhile, Tesla owners in China united to raise 123,000 yuan or about $17,500 to purchase N95 masks, surgical masks, and sets of protective clothing that they plan to donate to different hospitals treating patients infected by the coronavirus. Tesla has also donated 5 million yuan or more than $700,000 to assist the government and other institutions involved in disease control.

The recent news from China appears to have weighed down on Tesla stock. As of writing, TSLA stock is trading -13.92% at $763.59 per share. 

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Amazon has revealed the design of its upcoming all-electric delivery vehicle, produced in partnership with Rivian.

The $1 trillion dollar e-commerce giant has taken the wraps off a life-size clay model and a small-scale model of its planned delivery van. Unsurprisingly, the all-electric vehicle looks very similar to the current Amazon Prime delivery vans, but with slightly rounded design cues and improved ergonomics and safety features.

Last year, Amazon announced that it has teamed up with electric truck startup Rivian to produce a massive 100,000-unit fleet of electric delivery vans. Amazon says it spent 18 months analyzing electric delivery truck options on the market until it decided to build its own custom van designed specifically for its delivery business.

The latest development reveals how far the Amazon-Rivian partnership has gone toward meeting Amazon’s goal of sending the first of the 100,000 vans delivering packages to American homes by 2021. Amazon hopes to get 10,000 of its electric vans deployed by 2022 and all 100,000 by the end of the decade.

Both the small-scale and life-size clay models were designed at the Rivian headquarters in Plymouth, Michigan, where rows of design boards featuring numerous versions of the Amazon delivery van fill an entire side of the studio.

In another room, Rivian has put together a virtual reality simulation setup to allow drivers to test the new driving experience and offer suggestions for improvement. Amazon says it has consulted heavily with its drivers in working on the truck’s final design, considering certain factors such as loading and unloading of packages, ease of getting in and out of the van, and seat comfort.

“We’re focused on driving efficiency into every aspect of the vehicle design—everything from cabin heating to driver ergonomics to drivetrain design has been optimized for time and energy,” says Rivian CEO RJ Scaringe.

Amazon says the van will be in three sizes with multiple battery configurations to suit various delivery routes. It will come with front-wheel and all-wheel driving options for different terrains and a variety of safety technologies, including automated emergency brakes, lane-keep assist, and a pedestrian warning system. The dashboard will include Amazon’s logistics management system and will provide drivers with the most efficient routes for delivery. It will also integrate Alexa to allow drivers to make hands-free voice commands.

Amazon’s plan to build its own fleet of electric delivery vans is part of its Climate Pledge, a commitment to meet the Paris Agreement in 10 years.

“When we succeed, if we displace those gasoline vehicles with electric vehicles, it will be a large step forward in making our package delivery business sustainable and it has a positive impact on the environment,” says Ross Rachey, director of global last-mile at Amazon.

Amazon is not the only major company that has partnered with Rivian. In January, Ford announced that it is working with Rivian to produce the first electric truck for its Lincoln luxury brand. The startup is also gearing up to release two of its own electric vehicles, the R1T pickup truck, and the R1S SUV, both of which are built on Rivian’s flat-frame skateboard platform. Both vehicles will also come integrated with Alexa.

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