California EV manufacturer Rivian said it has received conditional approval for a loan of up to $6.6 billion from the US Department of Energy to build a manufacturing facility in Georgia. Among those conditions there is a big one, that the company will not oppose the efforts to organize a union.
Rivian has been laying out plans to build a plant in Georgia – the company's second US plant – but the company has hit hard economic times, with shares down nearly 50% this year. Earlier this year, the company set up a factory in Georgia.
It has since built its smaller, more affordable R2 SUV at its plant in Normal, Illinois, where it makes its flagship R1S SUVs and R1T trucks.
“This loan will enable Rivian to ramp up our US production of R2 and R3 vehicles that emphasize power and affordability,” Rivian CEO RJ Scaringe said in a statement.
Of course, it's a “conditional” approval, meaning Rivian must “satisfy certain technical, legal, environmental, and financial conditions before the Department of Energy grants funding,” the company said.
Rivian is getting a $6.6 billion loan from the US Department of Energy – with a few conditions
Although the details of the circumstances were not included in the initial report, one detail was touched upon at least: that Rivian will not, in fact, oppose the efforts to organize a union in the Georgia factory, a source close to the matter told Reuters. However, the loan will not “guarantee unionization” in the industry either. We've reached out to Rivian for comment and will update this post if or when we hear back.
The Illinois factory, its only plant, has been under scrutiny for “worst” US security breaches than any other automaker since early 2023, according to Bloomberg. And the company has not warmed to unionization efforts, despite pressure from President Biden to do so. Back when Rivian applied for funding from the Department of Energy, the government was already urging the company to switch to a United Auto Workers Union-friendly status, though exactly what that means is unclear. It could mean, as Bloomberg cited in July, including a discussion about labor relations and showing more openness to working with labor unions. Of course, the next president has a different view on this matter, so maybe the current lack of clarity is just a way to hold back until we have a better idea of how both the EV landscape and UAW support will change.
Rivian's factory in Normal employs about 7,400 workers, and the EV maker is one of the city's largest employers, with many members of certain families working in the industry.
Rivian's Georgia plant will have an annual capacity of 200K
The Georgia loan comes from the state's Advanced Technology Vehicles Manufacturing program, which has also provided loans to Tesla, Ford, and GM. Rivian's Georgia EV plant is the state's second-largest development project after Hyundai's $7.6 billion plant that began production last week.
The facility will help Rivian bring 400,000 EVs to market “and for mass use,” the Department of Energy said in October when considering the loan. The 1,744-hectare site of the plant is 40 kilometers east of Atlanta, and will include two production blocks, each with a capacity of up to 200,000 vehicles per year. Rivian is expected to start operations in the second half of 2026.
On Monday, Rivian announced that the loan includes $6 billion in principal and $600 million in interest. The news follows Rivian closing its $5.8 billion investment in Volkswagen as part of their technology joint venture. Back in 2022, Rivian received $1.5 billion in state and local incentives for the Georgia plant. In May, the EV maker received $847 million in federal incentives to expand its Illinois factory.
Photo credit: Rivian
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