Rivian renegotiates Department of Energy loan to $4.5 billion, adjusts production capacity plans for Georgia plant

Rivian Cars It said on Thursday it had renegotiated a $6.57 billion loan from the U.S. Department of Energy to $4.5 billion and was adjusting production forecasts at a plant under construction in Georgia.

The DOE loan was previously slated to support two phases of production totaling 400,000 units per year. The company said on Thursday that the amended loan covers one stage of production with a total capacity of 300,000 cars.

The changes allow Rivian to take advantage of the loan sooner and get more initial production but reduce the plant’s total production capacity amid uncertain demand for all-electric vehicles.

The initial loan terms were negotiated under the Biden administration. They have been in limbo under the Trump administration, which has taken measures to cut or reduce these loans and pulled government investments to promote electric vehicles.

Rivian said it plans to avail the loan in 2027, a year earlier than previously planned. The automaker also said that production of the company’s upcoming R2 electric vehicle is on track to begin at the facility in late 2028, after recently starting production at its current facility in Normal, Illinois.

Rivian CEO RJ Scaringe told CNBC’s Phil LeBeau on Thursday that any future expansion of the Georgia plant would be financed by the company, which has raised capital through partnerships with companies like Volkswagen and Uber.

The electric vehicle maker announced details of the new loan in connection with its first-quarter results, which included a net loss of $416 million, or 33 cents per share, down from a loss of $541 million, or 48 cents per share, a year ago. These per-share results were not comparable to Wall Street expectations.

Rivian’s revenue for the quarter was $1.38 billion, up from $1.24 billion a year earlier and up slightly from the $1.36 billion that analysts had expected, according to LSEG.

The company’s earnings, closely watched by investors, totaled $119 million, down $87 million during the first quarter from a year earlier. This included a loss of $62 million for the automotive segment and a profit of $181 million for the software and services division.

Rivian said the decline in auto profits was primarily due to a $100 million drop in auto regulatory credit sales and lower production volumes.