(SRN NEWS/AP) – The White House says the U.S. Department of Energy will make a $6.6 billion loan to Rivian Automotive to build a factory in Georgia that had stalled as the startup automaker struggled to become profitable.
It’s unclear whether the administration can complete the loan before Donald Trump becomes president again in less than two months, or whether the Trump administration might try to claw the money back.
Trump previously vowed to end federal electric vehicle tax credits, which are worth up to $7,500 for new zero-emission vehicles and $4,000 for used ones. Trump later softened his stance as Tesla CEO Elon Musk became a supporter and adviser.
Rivian made a splash when it went public and began producing large electric R1 SUVs, pickup trucks and delivery vans at a former Mitsubishi factory in Normal, Illinois, in 2021. Months later, the California-based company announced it would build a second, larger, $5 billion plant near Social Circle.
The R1 vehicles cost $70,000 or more. The original plan was to produce R2 vehicles, a smaller SUV, in Georgia with lower price tags aimed at a mass market. The first phase of Rivian’s Georgia factory was projected to make 200,000 vehicles a year, with a second phase capable of another 200,000 a year. Eventually, the plant was projected to employ 7,500 workers.
But Rivian was unable to meet production and sales targets and rapidly burned through cash. In March, the company said it would pause construction of the Georgia plant. The company said it would begin assembling its R2 SUV in Illinois instead.
CEO RJ Scaringe said the move would allow Rivian to get the R2 to market more quickly, sometime in 2026, and save $2.25 billion in capital spending. Since then, German automaker Volkswagen AG said in June it would invest $5 billion in Rivian in a joint venture in which Rivian would share software and electrical technology with Volkswagen. The money eased Rivian’s cash crunch.
Tuesday’s announcement throws a lifeline to Rivian’s grander plans. The company says its plans to make the R2 and the smaller R3 in Georgia are back on.