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Mercedes-Benz and Rivian partner to jointly build electric vans in Europe

Mercedes-Benz and Rivian are partnering to produce electric vans at scale in Europe.

The joint venture announced Thursday will help each automaker scale its bespoke large battery-electric van businesses as Mercedes-Benz plans to phase out gas-engine vans by 2025.

The news sent Rivian shares up 9% in morning trading.

Together, the companies plan to build and operate a factory in Europe that produces vans for both brands as Rivian, which has a contract to supply Amazon with 100,000 electric delivery vans (EDVs), begins to seek other commercial customers.

The partnership will enter production in a few years, according to Mercedes-Benz. The new EV factory will be located near one of Mercedes-Benz’s existing plants in Europe and serve as Rivian’s first international presence. Mercedes wouldn't disclose the exact location, except to say it is in Central or Eastern Europe.

Mercedes-Benz, which is gearing up to launch its next-generation electric Sprinter van next year, makes four electric vans -- the eVito Panel Van, the eSprinter, the eVito Tourer and the EQV -- in addition to its upcoming eCitan and EQT.

Rivian currently makes electric vans for Amazon, which holds an 18% stake in the startup and has a contract for 100,000. The automaker plans to start selling the commercial van to other customers next year.

The partnership will help each company leverage investments and costs. The vans will be based on Mercedes-Benz’s electric van platform, VAN.EA, and on Rivian’s second-generation Rivian Light Van (RLV) platform.

However, the agreement is currently only a memorandum of understanding and subject to regulatory approval. Ford dissolved a partnership to build an EV with Rivian last year.

“Mercedes‑Benz is one of the world’s best known and respected automotive companies, and we believe that together we will produce truly remarkable electric vans which will not only benefit our customers, but the planet,” Rivian CEO R.J. Scaringe said in a statement.