Forget the consumer market for electric vehicles. It turns out delivery vehicles could be the "Trojan horse" for electric to really take off.
Korean auto giants Hyundai and Kia put more than $110 million in U.K. startup Arrival, which emerged from relative stealth today. The investment immediately makes Arrival one of Britain's most valuable startups, valuing it at €3 billion ($3.4 billion), a company spokesperson said. According to the latest research from CB insights, only five other U.K. startups are worth more than this.
Although a five-year-old London-based company that has about 800 employees across five countries, including Germany, the United States and Russia, Arrival has been cagey about its activity until now.
Their idea is to make electric vehicles at similar costs to traditional fossil fuel vehicles but by drastically cutting costs by using "microfactories" close to major cities for manufacturing.
Its modular "skateboard" platform will allow a range of models to be built on one system and its prototypes are already participating in trials by global delivery companies such as DHL, UPS and Royal Mail.
In a statement, Youngcho Chi, Hyundai's president and chief innovation officer said: "This investment is part of an open innovation strategy pursued by Hyundai and Kia"
Hyundai is understood to be investing $35 billion in autonomous driving and electric cars.
Last year Hyundai announced a $35 billion commitment to develop self-driving technology and electric vehicles. As part of that, it wants to release 23 types of electric vehicles by 2025. Last week, it unveiled a flying taxi concept with Uber at the CES tech conference in Las Vegas.