Rivian Receiving $1.5 Billion Incentive Package from Georgia
Rivian Automotive Inc, purveyor of the all-electric R1T and R1S, will receive $1.5 billion in incentives from state and local governments to build a new manufacturing facility in Georgia. Eager to become home to the company’s planned $5 billion assembly plant, the state is offering a comprehensive incentive package that includes tax breaks. The government has a few stipulations, however.
Under the new agreement, Rivian’s factory would be required to produce 7,500 jobs and its existing investment target by 2028 to receive the full $1.5 billion. That includes a sizable battery production site and may explain why the state is offering up the largest corporate incentivization package in its history.
Georgia’s economic development commissioner, Pat Wilson, was quoted by Reuters as saying the upcoming facility represented a major victory by placing the region “at the forefront of the electric vehicle revolution.”
Despite numerous EV startups being accused of ginning up their business model to spur investments, local governments are still keen on encouraging manufacturing — especially if it happens to relate to the tech sector. While Rivian failed to meet its production goals in 2021, lost a bid to replace the USPs aged fleet, and has seen its share price decline since its November IPO, it’s also managed to deliver functional vehicles while some of its peers have not.
The Georgia plant, located east of Atlanta would be Rivian’s second U.S. assembly plant, after its plant in Normal, Illinois.
The company, which is 20 [percent] owned by Amazon.com Inc (AMZN.O), has launched three vehicle models in the U.S. — its R1T pickup, R1S SUV and EDV delivery van for Amazon — but has struggled ramping up production amid supply chain constraints, including a shortage of semiconductors.
Wall Street investors have been disappointed with the company’s progress and vehicle order numbers, and Rivian shares have dropped more than 75 [percent] since the company went public in mid-November.
Local residents living east of Atlanta have voiced concerns that the new facility would upset their quality of life. However, the State of Georgia seems eager to see new jobs arrive and has stated that the project will follow “locally required standards pertaining to water quality, groundwater recharge and runoff, and local ordinances.”
Rivian’s Georgia plant will be quite a bit larger than the 5,000-person facility in Illinois (pictured) and the company believes it can be completed by 2024 if everything goes according to plan. An executive summary of the project is available here for those interested.
“Today marks a milestone in our progress towards the development of our second U.S. manufacturing plant in Georgia as the Economic Development Agreement (EDA) between the Joint Development Authority (JDA) of Jasper, Morgan, Newton, and Walton counties, the State of Georgia and Rivian was approved and signed by all parties,” the automaker stated on Monday. “The long-term economic partnership promises to deliver value to Rivian, the people of Georgia and their kids’ kids’ kids.”
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