Rivian outlines R2 production location strategy, delays Georgia factory

Rivian Automotive's Normal, IL factory. (Photo: Rivian)

Today, Rivian unveiled the new, less expensive R2 electric vehicle, a more compact SUV than its R1S. It is expected to begin deliveries of the new R2 in 2026, but where it is going to be built was a question every viewer of Rivian’s live streamed event on Thursday was pondering.

Rivian said that it will initially begin production of the R2 in Normal, Illinois, at its flagship manufacturing facility and plans to essentially delay the construction of the Georgia factory as it navigates financial risks.

Rivian said it would focus on the Normal Plant for initial R2 production in an effort to start deliveries earlier and considerably reduce “the capital required for its launch.”

“Beyond significantly reducing the amount of capital needed to bring R2 to market, the company believes this approach considerably reduces risk to the launch and associated ramp; efficiently leverages its existing manufacturing and operations teams; and expands the total capacity for the site to 215,000 units per year,” Rivian said.

The company still plans to build the plant in Georgia but realizes that it needs to begin construction in a capital-efficient manner and at a time when the company is more stable.

Rivian Financials

Rivian stock rose over 13 percent today on the heels of the R2, R3, and R3X launch. However, the company has struggled with various financials, evident in its most recent Earnings Call.

The R1T and R1S vehicles have seen reasonable demand, but their high price points are not encouraging buyers to take a risk on an up-and-coming company, which is why many have sought to go with the more established Tesla, or even buy a comparable gas vehicle.

Rivian Georgia Factory on hold

The announcement of the Georgia factory being paused comes at a time when the R2 and R3 vehicles will help secure a more stable financial situation for the company.

Profitability is now the focus for Rivian, as it is still working to ramp and scale production. The new cars unveiled today will help establish quarterly profit, but it could take a few years.

Previously, the road where Rivian’s factory was set to be built in Georgia was labeled “Rivian Parkway.”

However, these signs have since been removed:

Credit: Elijah Stancel | Facebook

The $5 billion plant was set to be completed in the coming years and help Rivian scale production. Now that the plant is on hold, there is no timetable for it to be completed.

I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.

Joey Klender: Joey has been a journalist covering electric mobility at TESLARATI since August 2019. In his time at TESLARATI, Joey has broken several big stories, including the first images of the Tesla Model S Plaid, the imminent release of the 4680 Model Y through EPA certification, and several expansions to the Lucid AMP-1 factory in Arizona, to name a few. His stories have been featured in several publications, including Yahoo! Finance, Fox News, CNET, and Seeking Alpha. In his spare time, Joey is playing golf, watching MMA, or cheering on any of his favorite sports teams, including the Baltimore Ravens and Orioles, Miami Heat, Washington Capitals, and Penn State Nittany Lions. You can get in touch with joey at joey@teslarati.com. He is also on Twitter @KlenderJoey.
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