Before pausing Georgia factory, Rivian struggled to meet expectations

Electric vehicle startup Rivian on Thursday introduced its R2 crossover, the mass market EV the company for years said would be built at a new Georgia factory the company as recently as last month said would open in 2026.

The expected landmark moment for Georgia’s emerging EV sector instead turned into disappointment.

Rivian CEO RJ Scaringe announced the two-row EV would start production at the company’s existing factory in Illinois. Though he said expansion in Georgia remains part of Rivian’s future, the company announced the $5 billion factory is on hold.

“I want to be absolutely clear we remain committed to building our future in Georgia,” Scaringe wrote in an op-ed to The Atlanta Journal-Constitution. “This shift in launch cadence puts us in a stronger position prior to launching our Georgia plant.

California-based Rivian has yet to turn a profit. Its cash pile has shrunk from nearly $20 billion when it went public to less than $8 billion at the end of last year. Mass production of anything, particularly something as complex as an EV, is hard, and Rivian has had to grapple with pandemic-induced supply chain issues and competition from Tesla and traditional automakers among other challenges.

The decision to pause the factory — and put on ice 7,500 promised Georgia jobs — conserves cash for an upstart company still struggling to find its way to profitability in a competitive EV marketplace made more challenging by softer than expected demand.

But for Georgia, the decision stings.

“They need to stem the bleeding,” said Sam Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions. “Keeping the costs away from building the new plant for the time being will help them improve their status at the moment.”

A crunch for cash

When electric vehicle pioneer Tesla rocketed to become the world’s most valued automaker in 2020, it didn’t take long before Wall Street began searching for a rival.

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