Rivian has obtained preliminary approval for a $6.6 billion federal U.S. loan that will be used to build its plant in the state of Georgia. This project was delayed earlier this year due to cost-cutting mesures, so today's announcement is good news for the company.
The new plant will be responsible for the production of Rivian’s planned mid-size platform that will underpin the R2, R3 and R3X models already announced by the company.
The construction of the plant will take place in two phases. Each phase will result in a production capacity of 200,000 vehicles each, according to the company.
The loan includes $6 billion in principal and some $600 million in capitalized interest. Rivian says all of the funds come from the Department of Energy's Advanced Technology Vehicle Manufacturing Loan Program, according to Rivian. Technical, legal, environmental, and financial conditions will have to be met for the loan to be finalized.
A little under two weeks ago, Volkswagen said that it was increasing its investment plans in Rivian by $800 million, having already pledged $5 billion.
And as Automotive News reports, the two companies have also appointed executives to their multi-billion-dollar joint venture and unveiled a prototype electric vehicle.
Things are looking pretty good.
However, challenges remain for Rivian. Since the beginning of the year, the company's shares have fallen by 50 percent. This is attributable to its own difficulties but also to the slowdown in anticipated growth of EV sales, and more recently, fears that President-elect Trump will remove a tax credit aimed at stimulating the adoption of electric vehicles.