U.K. electric van developer Arrival last week announced that it has secured a $118 million investment from funds managed by BlackRock, providing a major boost to its ambitious expansion plans.
The company said the latest funding round would support the ramping up of its vehicle production capacity, including the launch of its first U.S. "microfactory" in South Carolina.
"We are excited to welcome BlackRock as a strategic financial investor with its excellent track record in ESG," said Denis Sverdlov, founder and CEO at 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."
The investment is the latest in a string of successes for Arrival, which has emerged as a major player in the fast-expanding market for commercial electric vans.
In January, Arrival announced auto giants Hyundai and Kia had invested $110 million in the company before then confirming that it had secured an order for 10,000 electric vans from UPS as part of a deal that also saw the logistics giant invest in the firm and take out an option for another 10,000 vans.
Arrival said the latest 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 e-commerce and is predicted to reach 8 million commercial and passenger fleets by 2030 in the U.S. alone."
The company is one of a growing band of startups and established auto manufacturers working to meet growing demand for electric vans.
However, Arrival has argued its modular vehicle designs and strategy of developing small microfactories that require relatively low levels of capital expenditure and can be scaled quickly means it is well placed to deliver cost competitive electric models to market quickly.
"This transformative approach reduces the costs of production and emissions of shipping, and does not require 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," the company said.
The latest microfactory will be in York County, South Carolina, backed by a $46 million investment. Arrival is set to begin fitting out the unit now and is expected to begin operations at the site in the second quarter of 2021, with production starting before the end of the year.
The company said each of its microfactories could produce 10,000 vans or 1,000 buses a year.