In its first earnings report since the company’s blockbuster $13.7B IPO in November, electric vehicle maker Rivian announced its plans to build a second EV factory, this time in Georgia. (Rivian’s only current factory is in Normal, Ill.) The Irvine, Ca.-based company delivered compelling numbers, but admitted the challenges of scaling up production rapidly. “We’re confident that, alongside Illinois, Georgia is the place for Rivian to continue to scale and thrive,” said Rivian Chief People Officer Helen Russell.
In November, Rivian CEO R.J. Scaringe said he’s aiming to build at least one million vehicles by decade’s end. Rivian may be far off its mark, but it will catch up once their plans become reality. Its first shipment of R1T electric trucks earned the company a cool $1 million, though it was offset by the net third quarter loss of $1.23 billion thanks to high R&D costs and its scaling of various facilities to accommodate the company’s predicted popularity. This year, it shipped 386 R1T or R1S electric trucks. Amazon has placed 100,000 orders just for the electric delivery vehicles (EDV). The company’s infancy has been affected by supply chain problems.
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Rivian may have three elegant electric cars to showcase, but it is still in the early stages of making these vehicles. Only September saw the first Rivian R1 mass-produced off the production line. And while the announcement of a second factory in Atlanta, Ga., is good news for one of the approximately 71,000 customers who preordered Rivian cars, production there won’t begin until 2024. This factory can produce up to 400,000 cars annually.
Manufacturing is expected to improve. Today, the company revealed that it will increase production at its Normal, Ill. factory by 150,000 to 200,000. This gives it an advantage over other electric EV companies such as Tesla which has more than a dozen worldwide factories. “Launching three vehicles across two platforms during our first year of production requires the simultaneous ramp of our supply chain, hiring and training of a production workforce, equipment bring-up, and rapid iteration through production quality loops,” read a company shareholder letter.
The earnings report is short-term. One, Rivian continues to invest heavily in its own business, which is a significant disadvantage when compared with the fast-growing EV market. But its planned expansion, big name partners like Amazon and Ford, and sheer popularity among EV buyers all add up to a new automotive company that could breed more competition and enticing electric cars for customers not into the current market’s limited lineup.
