Arrival, a U.K. startup preparing to build electric buses and delivery vans, is expanding its model line to include a small, battery-powered passenger car and is partnering with Uber to fine-tune it for use in rideshare fleets.
The Arrival Car is intended to be a relatively low-cost electric vehicle designed for ride-hail and car-share fleets, initially in the U.K. and European Union, says Tom Elvidge, Arrival’s senior vice president of mobility. Production begins in late 2023 at one of the flexible “microfactories” London-based Arrival is setting up, following the start of assembly of its transit buses and commercial vans. Before that, Uber drivers will provide design feedback to refine the car’s packaging and features.
“The partnership we have with (Uber) is to ensure that they get the very best product for what they need,” said Elvidge, a past general manager for Uber in the U.K. and Ireland. He didn’t provide any financial details. “It’s something that needs to be affordable. It needs to be very durable, user-friendly, easy to clean, able to accommodate multiple passengers getting in and out over the course of a day, and easy to service.”
Founded by Russian billionaire entrepreneur Denis Sverdlov, Nasdaq-list Arrival is part of a wave of next-generation electric vehicle companies looking to broaden the market for nonpolluting cars and trucks. In contrast to Elon Musk’s Tesla, which aims to reduce production costs by building massive, multibillion-dollar Gigafactories, Arrival’s approach is small, low-cost factories that can be set up in existing warehouses to produce lightweight vehicles that cost about as much as gasoline-powered models owing to smaller battery packs and body panels made of composite materials. Its first three microfactories, each costing less than $50 million, are being set up in England, South Carolina and North Carolina, with more on the way.
Arrival came out of semi-stealth with a bang in early 2020 when Hyundai and Kia bought a 100 million euro ($110 million) stake. Soon after UPS, which is also an investor, said it would buy up to 10,000 Arrival electric delivery vans for its fleet in a deal that ultimately could be worth nearly $500 million. The company says it expects to begin generating revenue this year and be cash flow positive in 2023.
Arrival’s collaboration with Uber is not exclusive and the company could ultimately supply its vehicle to other fleets. The price and estimated driving range per charge for the Arrival Car haven’t been set yet, though the latter is likely to be at least 250 miles, Elvidge said. That’s one of the details that will be determined as a result of testing by Uber drivers.
Uber, which operates mainly in dense, urban environments, has a goal of offering rides exclusively with electric vehicles on its platform in London by 2025 and adopting that standard across North America and Europe by 2030.
“Uber is committed to helping every driver in London upgrade to an EV by 2025, and thanks to our Clean Air Plan more than £135 million ($188 million) has been raised to support this ambition,” said Jamie Heywood, Uber’s regional general manager for Northern and Eastern Europe. “Our focus is now on encouraging drivers to use this money to help them upgrade to an electric vehicle, and our partnership with Arrival will help us achieve this goal.”
Shares of Arrival fell 6.7% to $17.35 in Nasdaq trading on Monday.