Electric vehicle (EV) startup Arrival has announced securing a $300 million equity financing line from Westwood Capital, according to a statement released on Monday. The funds will help the British firm achieve its goal of commencing US production of its van in late 2024 and tackle the cash crunch it has been facing for the past few months.
The Arrival team had previously expressed concerns about not having enough money to last through 2023, warning of a potential cash shortfall. With the new infusion of funds, the company hopes to reach a target quarterly cash-burn rate of $35 million by the second half of 2023 by implementing cost-cutting measures, including layoffs.
CEO Igor Torgov highlighted the significance of the financing line in a statement, stating, “This financing line provides us with access to more liquidity, and will fund the business into late-2023.” Torgov was appointed as CEO in January after the company announced layoffs of half of its staff in 2021.
In addition to keeping the lights on, the additional capital will enable Arrival to leverage the Inflation Reduction Act, which provides incentives to stimulate EV manufacturing and adoption in the United States. Arrival is not alone in its pursuit of the growing EV market, with established automobile players such as General Motors’ BrightDrop and Ford Motor, as well as upstarts like Rivian Automotive, entering the segment.
See also: Arrival Announces Layoffs and New CEO to Secure Company’s Future
The financing round is expected to provide Arrival with the financial resources to meet its ambitious goals, including the successful launch of its EV van in the United States. With increased liquidity, Arrival is poised to make significant strides in the EV industry and achieve its vision of sustainable transportation for all.
