A massive investment is coming.
Rivian's growth continues at an impressive rate. Not only are six new models in various development stages to join the Rivian R1T and R1S, but the Amazon and Ford-backed electric vehicle company also wants to build a second US-based factory. The Normal, Illinois factory is currently churning out those first two models. We first caught wind of Rivian's new factory plans last month but we didn't know where it'll be located. There's a much clearer picture today.
Bloomberg reports Rivian is in talks to invest no less than $5 billion in a new factory located near Fort Worth, Texas. Codenamed "Project Tera," the proposed 12 million square foot factory is expected to have an annual production capacity of 200,000 vehicles and will create around 7,500 jobs by 2027. It would be built on a proposed 2,000-acre site.
This isn't the only city and state Rivian is considering for its new factory but it appears to be the top contender due to attractive tax incentives and access to talent. The average annual Rivian employee salary there would be $56,000 a year. Arizona is also being studied but Rivian CEO and founder R.J. Scaringe was reportedly concerned about "available infrastructure." Rivian declined to comment on the report but it also didn't flat-out deny it.
No final decision has been made but Rivian's choice of Texas for a truck plant isn't without precedent. Tesla is currently building its own massive new production facility near Austin that will build both the Cybertruck and Model Y crossover.
Ironically for both companies, Texas does not allow a direct sales model for new vehicles. Only franchised dealerships are legal. Because Tesla and Rivian opt for the former (for now), Texans would have to travel out of state to directly make a purchase. There's been increasing pressure on states that currently ban the direct sales model to change existing policies. Compromises have been reached in some states, such as Michigan.
There's no indication yet as to when Rivian will announce its final decision regarding its new factory, but we wouldn't be surprised if this happens by the end of the year.
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