Electric truck manufacturer Rivian has announced a temporary pause in the construction of its $5 billion manufacturing plant in Georgia. The company had plans to produce its R2 midsize SUV at this facility.
The decision to halt construction, Georgia’s second-largest economic development project, comes despite $1.5 billion in incentives from the state and local governments.
Rivian’s CEO, RJ Scaringe, stated that R2 production will commence at the existing plant in Normal, Illinois, to expedite market entry and save $2.25 billion. While the Georgia plant remains crucial to Rivian, the timing for construction resumption is currently unspecified.
Rivian’s share price saw a 13% increase after the announcement of new models, closing at $12.51. However, this is significantly lower than its stock valuation during the 2021 public offering, where it briefly surpassed Ford in market capitalization.
The Georgia plant, near Social Circle, was expected to employ 7,500 workers and produce up to 200,000 vehicles in its initial phase by the end of 2023. A second phase planned for 2030 aimed to increase capacity by an additional 200,000 vehicles annually.
The state and local governments had committed over $125 million for the nearly 2,000-acre site preparation, and roadwork projects were also underway. If the plant is not ultimately built, it could impact Georgia’s aspiration to become a hub for the electric vehicle industry.
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Rivian has reassured its commitment to Georgia, and state officials are in continuous communication with the company regarding its manufacturing plans.
The temporary pause has been met with mixed reactions, with some expressing hope that it may lead to reconsideration of the plant’s construction. The outcome will significantly impact Georgia’s standing in the growing electric vehicle sector.
