BlackRock invests $118 million in London-based electric vehicle startup Arrival to provide zero-emission mobility solutions for cities

Arrival is a London, England-based tech startup that develops generation two electric vehicles. The company develops software, materials, components, and scalable skateboard platforms and its micro-factories allow them to make vehicles and adapt to any mobility ecosystem.

Now, the startup has received the attention of BlackRock, a global investment firm that manages nearly $7.43 trillion in assets on behalf of investors worldwide. Today, the British electric vehicle startup announced it has raised $118 million from U.S. funds manager BlackRock to support the execution of its growth plans, including the launch of the first US Microfactory. BlackRock investment’s in Arrival is not surprising. BlackRock also invested in electric pickup trucks startup, Rivian. Back in February, we also wrote about BlackRock after the firm launched a foundation to advance a more inclusive and sustainable economy.

Meanwhile, before the latest funding round of funding, Arrival was valued at $3.3 billion according to the public funding record. Arrival is also positioned as a potential rival to U.S. startup Rivian, which is backed by Ford Motor F.N and Amazon AMZN.O, among others, and is building 100,000 electric delivery vans for Amazon. Arrival has an order for 10,000 electric delivery vans from UPS, with an option for another 10,000.

Founded in 2015 by Denis Sverdlov, Arrival is reinventing the automotive industry with its entirely new approach to the design and assembly of electric vehicles. The company’s new method uses low CapEx, rapidly scalable Microfactories that can be placed anywhere in the world to serve the regions they are located in. These Microfactories, combined with proprietary in-house developed components, materials, and software, enable the production of best in class vehicles that are competitively priced to fossil fuel variants. This transformative approach reduces the costs of production and emissions of shipping and does not require a massive upfront investment, creating strong unit economics for the whole of Arrival’s product portfolio, including its electric van and bus announced earlier this year.

“We are excited to welcome BlackRock as a strategic financial investor with its excellent track record in ESG,” said Denis Sverdlov, Founder and CEO of Arrival. “This additional capital will be invested into Arrival’s growth, as we deepen and expand our presence in the U.S. and other new markets globally. With our new Microfactory in South Carolina, we are looking forward to partnering with more cities and companies to create a sustainable future.”

Arrival has made major inroads in the commercial electric vehicle market having received an order of 10,000 electric vans from logistics company UPS, with the option for a further 10,000. This investment is a reflection of the significant market opportunity for electric vehicles, particularly in the commercial segment, which continues to grow with increasing demand for eCommerce and is predicted to reach 8m commercial and passenger fleets by 2030 in the US alone. Arrival is poised to address this entire market, with its competitive price and substantially lower Total Cost of Ownership, solving the problem of pollution and congestion in cities around the world.

The new funding will support the Arrival’s plans to scale its Microfactory footprint in both the U.S. and Europe. As part of its U.S. strategy, the company announced this week the launch of its first U.S. Microfactory in York County, South Carolina, an investment of $46M into the region and the creation of local jobs. Arrival will begin fitting out the unit and is expected to begin operations in Q2 2021, with the start of production in Q4 2021. Arrival’s Microfactories produce 10,000 vans or 1,000 buses per year.