EV startup Rivian to build $5 billion plant in Georgia

Amazon-backed electric vehicle startup Rivian Automotive Inc. will build a $5 billion plant in Georgia, its second U.S. assembly plant, as it looks to expand production.

The new plant will employ more than 7,500 people, is scheduled to open in 2024 and will eventually build 400,000 vehicles a year, the company said Thursday, largely confirming plans previously outlined in documents filed with other states.

The plant will be located on the so-called East Atlanta Megasite, Georgia Gov. Brian Kemp said in a statement. Plant construction is slated to begin in the summer of 2022 about 30 miles east of Atlanta. Production is targeted to begin in 2024.
 

In its first publicly reported earnings since it went public last month, Rivian said it posted a third-quarter net loss of $1.23 billion, or an adjusted net loss of $776 million.

The EV maker reported revenue of $1 million after it started to ship its first vehicles in September.
 

With a market value of almost $93 billion, Rivian made its Nasdaq debut last month in the world's biggest initial public offering of 2021. Rivian raised almost $14 billion in the IPO to fund future growth on top of the $10.5 billion it had raised privately from such investors as Amazon.com Inc. and Ford Motor Co. Amazon owns 20 percent of Rivian and Ford owns about 12 percent.

The Irvine, Calif., company has struggled with the launch of the R1T pickup, R1S SUV and delivery van for Amazon as supply-chain constraints, including chip shortages, hit automakers globally. The pickup launched in September and the SUV in December.

During the pandemic, the chip shortage forced automakers to curtail vehicle production and vehicle prices rose due to limited inventories. Companies are now scrambling to protect operations against the spread of the omicron variant of the coronavirus.

"Launching and ramping production of three different vehicles within a few months is an incredibly tough challenge," CEO R.J. Scaringe said on a conference call.

Issues he cited included global supply-chain constraints, the COVID-19 pandemic, a tight labor market and short-term issues around building electric battery modules.

Scaringe added Rivian was focused on pulling ahead the timeline for increasing vehicle output.

Rivian, other startups and established automakers are racing to take on EV leader Tesla Inc. as pressure grows in regions including China and Europe to eliminate vehicle emissions.

Rivian's Georgia plant will join the one in Normal, Ill. The company intends to eventually open plants in Europe and China. Scaringe previously said Rivian plans to build at least 1 million vehicles a year by the end of the decade.

The Illinois plant currently has an annual capacity of 150,000 vehicles and Rivian has said it intends to increase that to 200,000 by 2023 as it adds new vehicles. Scaringe has said the company has sold out its R1 lineup into 2023.

Shares in Rivian fell 9.1 percent to $99 in after-hours trading.

Rivian has been prioritizing resources and man power for the Amazon Van project over its own consumer models. Rivian said Thursday that it would start deliveries of the first saleable Prime Rivian vans to Amazon this month.

Net preorders for the two R1 models grew to a combined 71,000 as of Dec. 15, Rivian said, up from 55,400 at the end of October.

Morgan Stanley analyst Adam Jonas said the new order count seems to have come in at the low end of expectations.

Ford said this month it had capped reservations for the F-150 Lightning electric pickup at 200,000.

Rivian ended the quarter with cash and cash equivalents of $5.2 billion. Factoring in the proceeds of the company’s IPO and the value of its senior secured notes, the company would have $19.9 billion of available cash. The company has also grown to more than 10,000 employees.

Reuters and Bloomberg contributed to this report.