# British EV startup Arrival gets $300 million funding, aims to slow cash-burn
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-03-14
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Arrival secures $300M financing for U.S. production plan
Meta Description: Learn about Arrival's efforts to slow cash-burn rate and begin U.S. production in late-2024. Stay informed on the cash crunch facing EV firms.
URL: https://financedigest.com/british-ev-startup-arrival-gets-300-million-funding-aims-to-slow-cash-burnhtml

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(Reuters) -Electric-vehicle (EV) startup Arrival on Monday got a $300 million equity financing line from Westwood Capital and said it seeks to slow its cash-burn rate, as the British firm looks to start U.S. production of its van in late-2024.

U.S.-listed [shares of the company closed 13.5% lower](https://www.financedigest.com/ford-posts-lower-profit-issues-downbeat-outlook-shares-drop.html "Ford posts lower profit, issues downbeat outlook; shares drop").

EV firms have been experiencing a cash crunch over the past few months, as high [costs related to production ramp-ups and soaring](https://www.financedigest.com/amazon-other-retailers-revamp-free-shipping-as-costs-soar.html "Amazon, other retailers revamp ‘free’ shipping as costs soar") inflation eat into their reserves.

Arrival [expects to achieve its target of quarterly](https://www.financedigest.com/ericssons-quarterly-core-profit-misses-expectations.html "Ericsson’s quarterly core profit misses expectations") cash-burn rate of $35 million by the second half of 2023, as layoffs and other cost-cut measures take effect. At the end of 2022, the [company had about $205 million](https://www.financedigest.com/swiss-insurance-company-helvetia-uses-squirro-to-deliver-better-search-results-to-its-five-million-customers.html "Swiss insurance company Helvetia uses Squirro to deliver better search results to its five million customers") in cash and cash equivalents.

The developments come after Arrival’s [warning last year that said it may not have enough cash to keep its business](https://www.financedigest.com/pitiless-machines-will-kill-your-business-if-you-dont-respond-now-warns-servion.html "‘Pitiless machines’ will kill your business if you don’t respond now, warns Servion") going towards the end of 2023. In January, it [named Igor Torgov as its CEO](https://www.financedigest.com/novartis-names-firmenich-ceo-as-chairman-designate-of-sandoz-2.html "Novartis names Firmenich CEO as chairman designate of Sandoz") and announced laying off half of its staff.

Arrival also [shifted its focus](https://www.financedigest.com/stocks-fall-bond-yields-rise-as-focus-shifts-to-fed-rate-outlook.html "Stocks fall, bond yields rise as focus shifts to Fed, rate outlook") to the United States late last year, in order to benefit from the Inflation Reduction Act, which provides incentives to spur EV manufacturing and adoption.

High demand for [electric vans](https://www.financedigest.com/lack-of-electric-vans-opens-door-for-chinese-other-ev-makers.html "Lack of electric vans opens door for Chinese, other EV makers"), meanwhile, has brought legacy automobile players, including General Motors’ BrightDrop, Ford Motor Co, and upstarts like Rivian Automotive, to the segment.

On Monday, Arrival said the [additional capital will provide the company with access to more liquidity and that the infusion will fund](https://www.financedigest.com/need-additional-funding-but-not-sure-how-to-go-about-it.html "Need additional funding but not sure how to go about it?") the business into late-2023.

The [capital raised](https://www.financedigest.com/shares-in-monte-dei-paschi-plunge-14-after-capital-raise.html "Shares in Monte dei Paschi plunge 14% after capital raise"), however, will not provide for investments in production of its van in its Charlotte, North Carolina facility and the company said it was kicking off fundraising efforts to fund the U.S. [production plan](https://www.financedigest.com/workplace-planning-software-cuts-costs-and-improves-employee-wellbeing-and-productivity-a-win-win-for-all.html "Workplace planning software cuts costs and improves employee wellbeing and productivity – a win-win for all").

The [company also called for an extraordinary meeting of shareholders to vote on a reverse stock split](https://www.financedigest.com/in-listening-mode-new-bayer-ceo-keeps-open-mind-on-company-split.html "In listening mode, new Bayer CEO keeps ‘open mind’ on company split") proposal to regain compliance with Nasdaq’s listing rules.

(Reporting by Akash Sriram in Bengaluru; Additional reporting by Eva Mathews; editing by Uttaresh Venkateshwaran)


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