Rivian delays $5B Georgia EV plant to accelerate R2 launch Leave a comment

The EV maker will begin building its new R2 electric SUV at its Normal, Illinois facility to accelerate the launch. Meanwhile, Rivian (RIVN) is delaying construction at its new $5 billion EV plant in Georgia, where the R2 was initially expected to be produced. The delay is not expected to be significant.

Rivian to launch R2 at Normal EV plant, saving $2.25B

Rivian introduced its more affordable R2 electric SUV Thursday during a launch event at its new Laguna showroom.

The electric SUV takes the unique Rivian Adventure Vehicle design shown in the R1 series and puts it into a smaller, more affordable package.

Based on a new, more efficient platform, Rivian’s R2 will be available in single, dual, and tri-motor versions. All will have over 300 miles (483 km) of range.

At 4,715 mm long, 1,700 mm tall, and a wheelbase of 2,935, the R2 is smaller than the R1S (5,100 mm x L, 1,873 mm x H, 3,075 x wheelbase). It’s essentially the size of the Tesla Model Y.

Rivian’s R2 will start at $45,000. Rather than beginning production at its new Georgia EV plant, Rivian said it will launch the electric SUV at its Normal, Illinois, facility.

Rivian said the move will save around $2.25 billion, a significant amount of capital the EV maker can use to launch the R2. New upgrades to Rivian’s Normal EV plant will enable up to 215,000 vehicles to be built annually, up 43% from its previous annual capacity of 150,000.

As a result, Rivian plans to move R2 production to the first half of 2026. Rivian said its Georgia EV plant remains an “extremely important part of its strategy to scale production of R2 and R3.” Construction will begin later to focus on the launch of R2 in Normal.

Rivian’s CEO RJ Scaringe ended the R2 launch event with a Steve Jobs-like “one more moment,” unveiling the R2’s sister, the Rivian R3, and its high-performance tri-motor R3X electric crossover variant.

Electrek’s Take

Rivian’s CFO, Claire McDonough, said last month that the company remained confident that its cash and equivalents could fund operations through 2025.

By launching the new electric SUV in Normal, Rivian expects to have sufficient funding through the start of R2 production.

Announced in November, Rivian will introduce new plant upgrades during a planned shutdown this quarter that will meaningfully reduce material costs later this year. Rivian expects to achieve a “modest growth profit ” by the end of the year.

Because of the shutdown and plant revamp, Rivian expects vehicle deliveries to remain flat this year with around 57,000.

Rivian’s R2 and R3 will help it expand into new markets, including Europe, with smaller, more affordable models.

Rivian is not the only EV maker that backtracked on plans to build next-gen models at a new facility. Tesla did the same with its next-gen EVs and Gigafactory Mexico.

Tesla officially announced “Gigafactory Mexico” last March, where it planned to build cheaper, next-generation electric cars. However, an excerpt from CEO Elon Musk’s biography confirmed the next-gen EVs will be made in Texas rather than Mexico as the plant was falling behind its timeline.

Rivian’s move, like Tesla’s, could pay off. The companies can use what they learn from setting up production at established plants to allow for more efficient new facilities in the future.