Struggling British electric vehicle start-up Arrival faces delays to its first working van after one caught fire during demonstration for delivery firm UPS – its largest customer
- Arrival, which is headquartered in London, initially gained a £13million valuation
- But production difficulties has seen the company’s valuation plunge to £388m
- Blaze at its part in Banbury, Oxfordshire will cause further problems for the firm
British electric vehicle start-up Arrival is facing major delays to the sale of its first working van after one caught fire during a demonstration for delivery firm UPS – its largest customer.
The struggling firm has been hit by a series of issues as it tries to bring its innovative products to market, including a battery blaze in early December at its plant in Banbury, Oxfordshire.
No one was hurt in the incident, but after the van was wheeled out of the factory the flames melted part of the surface of the car park, the Financial Times reported. It is expected to delay delivery of the van by several years.
British EV start-up Arrival has been hit by a series of issues as it tries to bring its innovative products to market
Morale among staff has sunk to ‘rock bottom’ following widespread job losses to preserve the firm’s dwindling cash pile and a ‘distracting’ side-project to make an electric jet, sources told the FT.
Discontent among employees has even led to tools being stolen from one of Arrival’s sites and leaks of commercial information, it is claimed.
The company, which is headquartered in London, was hailed as a British success story after achieving an eye-watering $15billion (£13m) valuation.
Last year, it partnered with Uber to build a fleet of electric cars that were set to hit streets across Europe by 2025.
But Arrival has since run into production difficulties, prompting a colossal fall in its share price to make the company now worth just $444m (£388m).
Beginning production ‘is much more difficult than we thought, for sure’, CEO Denis Sverdlov has previously admitted.
Arrival has now ditched its car and bus projects to save money and is now focusing on building an electric van for the US market.
The company said it made a van in September which proves its manufacturing process works, but sources told the FT the model in question was largely built by hand.
Earlier this year, a prototype electric van caught fire in front of representatives of delivery firm UPS, its largest customer
Last month, the firm prompted dismay in the UK after announcing it was relocating manufacturing to the US, prompting hundreds of job losses.
Bosses have also raised eyebrows among staff over its decision to ringfence funding for a previously undisclosed venture – making an electric jet plane.
After the FT approached Mr Sverdlov with a detailed list of questions, he sent an internal message accusing anyone providing information of ‘betrayal’, the newspaper reported.
MailOnline has contacted the company for comment.
Arrival: EV start-up founded by Russian entrepreneur which planned to produce 10,000 vans a year from its Oxfordshire plant
Arrival was founded in 2015 by Denis Sverdlov, a Russian entrepreneur who set up several internet companies in the 2000s after briefly serving as deputy communications minister under Vladimir Putin’s prime minister, Dmitry Medvedev.
Mr Sverdlov, who is now based in London, came up with the idea of building electric vehicles in small, highly-automated plants called microfactories.
This is a break with traditional methods for manufacturing vehicles which can involve long production lines nearly a mile long.
Russian entrepreneur Denis Sverdlov, who is now based in London, founded Arrival in 2015
Fuelled by record levels of funding for tech start-ups, Arrival went on to sign a $1.2bn (£1bn) deal to supply electric delivery vans to UPS before signing a similar deal with Royal Mail.
In addition, it teamed up with ride-sharing giant Uber to roll out a fleet of stylish electric cars in Europe.
‘Arrival Car’ was intended to address a ‘global need’ to shift ride-hailing and car sharing services from petrol and diesel to electric to reduce greenhouse gas emissions and improve air quality in cities.
At the peak of its success, Arrival announced plans to roll out 10,000 electric vans per year from its factory in Oxfordshire.
But momentum has now faltered, with Arrival shares plunging by 90 per cent after it revealed a series of production difficulties.
Its troubles are mirrored by other EV start-ups who have tried in vain to replicate the success of Tesla, the market leader.
‘Arrival Car’ was intended to address a ‘global need’ to shift ride-hailing and car sharing services from petrol and diesel to electric to reduce greenhouse gas emissions and improve air quality in cities
Bird’s eye view of the vehicle’s interior, front facing left. The final vehicle design expected to be revealed before the end of 2021
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