Rivian Automotive claims the pending federal legislation intended to incentivize people to buy electric cars and trucks puts it at a competitive disadvantage.
James Chen, vice president of public policy for Rivian, said in a statement and interview for Automotive News that the pending climate change bill would give most breaks to other manufacturers like Tesla and General Motors that have had longer to ramp up production or build some of their vehicles overseas.
“As currently drafted, this legislation will pull the rug out from consumers considering purchase of an American-made electric vehicle. The final package must extend the transition period to provide consumer choice and protect good-paying manufacturing jobs here at home.”
More specifically, Rivian’s problem is that the $7,500 federal incentive only applies to EVs costing $80,000 or less, including related charges. Furthermore, the income of a buyer could be no more than $150,000 a year, twice that for a couple. Chen says that as a result, “nearly all of our vehicles would be ineligible for incentives,” as the company is not planning to offer a lower-priced model before 2025.
Gallery: Rivian Manufacturing Plant In Normal, IL
The executive argues that the pending legislation looks only at the sales price and does not offer specific incentives for EVs that are made in America, favoring “manufacturers who can come in at lower cost” because of foreign production.
Rivian builds the R1T pickup, R1S SUV and EDV delivery van for Amazon at its plant in Normal, Illinois, which employs more than 5,000 workers. Last week the company announced it was laying off 50 non-manufacturing workers at the plant but said it still plans to hire more for manufacturing this year in Normal. The company plans to open a second assembly plant near Atlanta, Georgia in 2025 to build more affordable R2 series EVs.
The new provisions in the pending bill, which also removes the production cap of 200,000 vehicles for each manufacturer, might be a response to criticism that incentives are going to wealthy people who don’t actually need them. That said, Chen argued that Rivian is just ramping up production and thus has higher costs than Tesla and other companies that have been in the game longer.
Rivian has contacted Senate leadership and senators from states where it has interests—Illinois, Michigan, California and Georgia—to see if the pending bill can be amended to allow startups to use the old rules during a transition period.
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