President Joe Biden's administration has announced a $6.6 billion loan from the U.S. Department of Energy to Rivian Automotive to aid in the construction of a factory in Georgia. The startup automaker had faced challenges in profitability, causing a pause in the project. The loan's completion timeline is uncertain, given the upcoming change in administration.
Rivian, known for its electric R1 SUVs, pickup trucks, and delivery vans, had planned to build a $5 billion plant in Georgia to produce R2 vehicles for the mass market. The factory was expected to employ 7,500 workers and have an annual production capacity of 400,000 vehicles.
However, Rivian struggled to meet targets and faced financial difficulties, leading to a halt in construction. The company redirected its focus to producing the R2 SUV in Illinois, aiming for a 2026 release and saving $2.25 billion in capital spending.
With a recent investment of $5 billion from Volkswagen AG, Rivian's plans for the Georgia plant have been revived. The loan, sourced from the Advanced Technology Vehicles Manufacturing Loan Program, aims to support the production of fuel-efficient vehicles and components.
The loan announcement has been praised by Democratic Senator Jon Ossoff, highlighting the federal investment in Georgia's electric vehicle manufacturing sector. Georgia Governor Brian Kemp aims to establish the state as a hub for the electric vehicle industry, despite differing views with the Biden administration on industrial policies.
Rivian's project in Georgia, supported by state and local incentives, faced legal challenges from neighbors opposing the development. The completion deadline for the investment and hiring commitments has been extended to 2030.
While Rivian's project faced delays, Hyundai Motor Group's $7.6 billion electric vehicle and battery complex in Georgia has seen rapid progress, with plans to employ up to 8,500 workers. The contrasting developments reflect the evolving landscape of the electric vehicle industry in the state.
