Electric-vehicle (EV) startup Arrival announced it has secured a $300 million equity financing line from Westwood Capital, according to a company statement released on Monday. The funding will enable the British firm to keep the lights on and pursue its goal of commencing US production of its van in late 2024.
Arrival has been grappling with a cash crunch over the past few months, warning in November last year it may not have enough money to last through 2023. With the cash infusion the company aims to achieve a target quarterly cash-burn rate of $35 million by the second half of 2023. The company expects layoffs and other cost-cutting measures to take effect and help in achieving the target.
Arrival’s CEO, Igor Torgov, said in the statement, “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.
The additional capital will also help Arrival benefit from the Inflation Reduction Act, which provides incentives to stimulate EV manufacturing and adoption in the United States. High demand for electric vans has led legacy automobile players like General Motors’ BrightDrop and Ford Motor, as well as upstarts such as Rivian Automotive, to enter the segment.
Despite the funding announcement, Arrival’s US-listed shares closed 13.5% lower on Monday.
Arrival to layoff 50% of its workforce in a bid to cut expenses, names new CEO