Electric vehicle (EV) manufacturer Rivian (NASDAQ:RIVN) will make its upcoming R2 car in Illinois. It is also pausing work on a planned manufacturing plant in Georgia.
The Georgia state government had pledged $1.5 billion in “tax incentives” for the plant, which is expected to employ 7,500 people and make 400,000 cars per year.
RIVN stock rose 13% on March 7 and another 5% overnight. It opened at $13.10 per share, a market capitalization of $12.7 billion.
One More Thing
CEO RJ Scaringe pulled out “one more thing” at the end of his presentation of the R2, unveiling a lower-priced R3 car that stole the spotlight.
The R3 has a smaller wheelbase than the R2 but carries the same silhouette and claims 300 miles of range on a charge. It’s considered a “crossover” as opposed to an SUV. That makes it similar to my old Toyota (NYSE:TM) Scion, with a lift-up hatchback, four doors, and a front trunk.
Scaringe said his company plans to make the R2 in Normal, Illinois, starting in 2026, then make the R3 in Georgia starting in 2027. Pausing the Georgia plant will let Rivian conserve as much as $2.25 billion.
If the R2 is a success, the R3 will put it in the heart of the auto market, where prices start at $25,000. Chinese maker BYD (OTCMKTS:BYDDF) is already selling EVs at that price point in Australia. The Biden administration is doing all it can to slow BYD’s entry into the U.S. market. Scaringe did not provide a specific price for the R3.
Both the new Rivian vehicles will feature a new battery, called the 4695, for its diameter of 46 millimeters and height of 95 millimeters. The new cells carry the same voltage but charge and discharge faster than those offered by Tesla (NASDAQ:TSLA).
RIVN Stock: What Happens Next?
Whether Rivian even builds the Georgia plant depends on its ability to maintain excitement around the R2. A press conference is nice, but sales are what the EV market needs.
On the date of publication, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
