Rivian (RIVN) is officially shutting down the Standard EV plant for upgrades

Rivian ( RIVN ) officially shut down production at its Normal, Illinois plant as the EV maker prepares for its next phase of growth. The company is upgrading the facility to reduce costs and improve efficiency as it looks to expand the brand.

Rivians shuts down EV production at the Normal, IL plant

First announced in November, Rivian is shutting down production at its Normal EV plant for several weeks to introduce new technologies and techniques to improve efficiency.

CEO RJ Scaringe explained the company was planning the shutdown in order to “implement a number of changes that introduced significant hardware cost reductions” for its R1S and R1T models.

These changes enable Rivian to produce vehicles with less labor and, therefore, lower costs per vehicle. Although the break is from April 5 to April 30, it will affect all four quarters as it increases production.

As a result, Rivian expects production to remain flat this year, with around 57,000 vehicles built in 2024.

Rivian has already significantly reduced the cost of building each vehicle over the past year, but the EV maker expects the improvements to “reduce” material costs.

The company lost $43,372 per vehicle built in Q4, down from $124,162 per vehicle a year earlier.

Rivian believes that improvements and new supplier cost reductions will drive moderate profitability in Q4 2024.

Entering the next stage of growth

The company built 13,980 vehicles in the first three months of 2024 while delivering 13,588. Although this is down slightly from Q4, Rivian expected deliveries to fall between 10% and 15%, but they fell by 3%.

Rivian will go from three shifts to two when it reopens its Normal plant. However, all assembly line workers will remain.

“We’re increasing the overall capacity and efficiency of our lines,” Tim Fallon, executive vice president of manufacturing at Normal, said. “In addition, we make a lot of improvements to our cars, many of which you can’t see, but which help us with our costs,” Fallon said, according to Chicago Tribune.

Rivian’s industrial president was speaking at an open house over the weekend at the facility, where it was showcasing its next-generation vehicles.

Rivian revealed its R2 mini last month with a starting price of around $45,000. Scaringe also had a “one more thing” moment like Steve Jobs, showing the more complex and cheaper R3.

“The R2 at $45,000 is something that a lot of people can see as an option,” Scaringe said. “There is a lack of choice, we believe, in that price category for well-made EVs.”

Less than 24 hours after opening orders, Scaringe said R2 received more than 68,000 reservations.

Rivian decided to start production at its Standard plant instead of its new $5 billion facility in Georgia. Scaringe said the move will speed up the R2 launch while saving the company $2.25 billion.

Scaringe reiterated his commitment to Normal and Georgia on Saturday, suggesting R2, and even R3, could continue to be built in Normal even after the GA facility goes live.

“We expect hundreds of thousands of units of demand, especially over a million units of demand worldwide. That means we will have at least two plants to make the car,” Rivian’s CEO explained.

The R2 stole the show at Rivian’s first open house in Normal since Fall 2019 as potential buyers flocked to see the new EV.