Rivian Automotive has received conditional approval for a nearly $7 billion loan from the U.S. Department of Energy. The money will be used to start construction on its Georgia plant.
Rivian first announced plans to build the $5 billion plant in late 2021, just months after going public. The facility, located 45 miles east of Atlanta, was forecasted to produce 400,000 vehicles annually and bring in 7,500 jobs. It was also to be the production hub for Rivian’s upcoming R2 and R3 SUVs.
However, Rivian executives announced earlier this year they would pause construction “indefinitely” at the site. Instead, the R2 SUV would be built at its existing plant in Normal, Illinois, to save money and move up the production timeline. Rivian had a planned shutdown of the Normal plant in spring to retool some production lines.
Now, the Georgia plant is closer to becoming reality once again as long as CEO RJ Scaringe and his team meet a handful of technical, legal, environmental and financial conditions. The DOE loan, which includes $6 billion in principal and $600 million in capitalized interest, comes from the Advanced Technology Vehicle Manufacturing loan program. That initiative has $17.7 billion for low-cost loans to spur production of fuel-efficient vehicles and their components. Companies such as Nissan and Tesla also have received loans from the ATVM for their Leaf and Model S models, respectively.
News of the loan is the latest in a spate of good news for Rivian. Earlier this week, it settled a four-year long lawsuit with Tesla wherein it was accused of poaching Tesla employees in order to steal battery technology information. Tesla filed to dismiss the case by Dec. 24 provided that the settlement terms—which haven’t been publicly disclosed—are satisfactorily met.
Earlier this month, Rivian and Volkswagen kicked off their joint venture focused on EV architecture and software. The venture, named Rivian and VW Group Technology, was first announced in June as part of a $5 billion investment the German giant was making in Rivian. The companies’ recent update boosted that figure to $5.8 billion.
The collaboration now includes $1 billion directly invested into Rivian, $1.3 billion to go towards IP licenses and equity in the JV, and the remaining $3.5 billion has been earmarked for future equity, notes and debt.
Rivian’s R2 will be among the first vehicles to use the new architecture, alongside those from VW’s Scout Motors division.
