Uber is now investing $1.25B in Rivian for robotaxi deployment
Uber Technologies, Inc. (UBER) is showing no signs of slowing down its aggressive push into the robotaxi space.
Last week the ride-hailing company announced three new initiatives to build out its autonomous vehicle (AV) strategy and then on Monday said it was expanding its partnership with Nvidia Corporation (NVDA) on a plan to launch a global fleet of NVIDIA software-driven AVs, starting in Los Angeles and San Francisco in the first half of 2027.
The two companies will then scale the launch across 28 cities globally by 2028.
And on Thursday, Uber and Rivian Automotive, Inc. (RIVN) announced a partnership that aims to accelerate both company's AV strategies, with a plan to launch 10,000 fully autonomous Rivian R2 robotaxis as part of the first phase of a multi-year initiative.
Initial deployment of the robotaxis is expected to begin in San Francisco and Miami in 2028 and then expand to 25 cities by 2031.
Along with the partnership, Uber is planning to invest up to $1.25 billion in Rivian through 2031, subject to the achievement of certain autonomous milestones by specific dates. The two companies are looking to build a scaled, fully autonomous fleet of R2 robotaxis that will be available exclusively through the Uber app.
Uber is making an initial $300 million investment in Rivian upon signing the agreement, subject to regulatory approval.
Rivian just recently unveiled its new highly anticipated R2 fleet, which has three models: R2 Performance, R2 Premium and R2 Standard. Wall Street has been bullish on the launch as it sees this more affordable midsize fleet as potentially helping Rivian create a legitimate threat to Tesla's (TSLA) dominance of the EV market in the United States.
Uber and Rivian noted that if they achieve all their milestones, they will have deployed thousands of unsupervised R2 robotaxis in cities across the US, Canada and Europe by the end of 2031.
“We couldn’t be more excited about this partnership with Uber — it will help accelerate our path to level 4 autonomy to create one of the safest and most convenient autonomous platforms in the world,” Rivian founders and CEO RJ Scaringe said in a statement.
“The scale of Rivian's growing data flywheel coupled with RAP1, our state of the art in-house inference platform, and our multi-modal perception platform make us incredibly excited for the rapid advancement of Rivian autonomy over the next couple of years.”
Level 4 autonomy is when a vehicle can operate in specific areas or under specific conditions without human intervention.
Rivian introduced its third-generation autonomy platform in December, as part of what it called its "software-first approach to autonomy" that includes its first custom computer chip for self-driving.
“We’re big believers in Rivian’s approach—designing the vehicle, compute platform, and software stack together, while maintaining end-to-end control of scaled manufacturing and supply in the US,” Uber CEO Dara Khosrowshahi said in a statement.
"That vertical integration, combined with data from their growing consumer vehicle base and experience managing the complexities of commercial fleets, gives us conviction to set these ambitious but achievable targets.”
Stifel analyst Stephen Gengaro reiterated his Buy rating on RIVN shares on Thursday, calling the partnership with Uber "a meaningful catalyst for Rivian's autonomous and platform expansion."
Meanwhile, Evercore ISI analyst Mark Mahaney reiterated his Outperform rating on UBER shares in a client note on Thursday. He said that the company is looking increasingly like an "AV winner," while adding that the Rivian investment "suggests sufficient capacity to support Uber's planned AV fleet scale-up,"