Rivian Shares Surge Over 4% Following $6.6 Billion DOE Loan Agreement

Rivian Automotive Inc (NASDAQ: RIVN) shares surged over 4% in Friday's pre-market trading following the announcement of a significant loan agreement with the U.S. Department of Energy (DOE). The DOE Loan Programs Office has committed up to $6.6 billion in financing to Rivian, supporting the construction of a new manufacturing facility in Georgia. This facility is expected to create 7,500 jobs and produce up to 400,000 mass-market electric sport utility vehicles (SUVs) and crossover vehicles annually.

The loan, made available through the DOE's Advanced Technology Vehicles Manufacturing (ATVM) Loan Program, will support Rivian's growth and strengthen its hold in EV design, development, and manufacturing in the U.S. The company plans to produce its all-electric midsize platform (MSP) with its R2 and R3 models at the Georgia facility, making its products more cost competitive and accelerating access to international markets.

Rivian's founder and CEO, RJ Scaringe, stated that the loan will help accelerate the launch of the Georgia plant for the R2 and R3 models, providing thousands of jobs in the state. The loan is divided into two phases, with the first phase receiving up to $3.4 billion and the second up to $2.6 billion.

Analysts' ratings for Rivian vary, with a consensus price target of $15.83. The highest target of $28 was set by Canaccord Genuity, while the lowest of $11 was issued by Mizuho. Recent ratings from UBS, Truist Securities, and Cantor Fitzgerald suggest an average price target of $13.67, indicating a potential downside.

In conclusion, Rivian's shares surged over 4% in Friday's pre-market trading following the announcement of a $6.6 billion loan agreement with the DOE. This loan will support the construction of a new manufacturing facility in Georgia, creating 7,500 jobs and producing up to 400,000 mass-market electric SUVs and crossover vehicles annually. The loan will help Rivian strengthen its hold in EV design, development, and manufacturing in the U.S., making its products more cost competitive and accelerating access to international markets. Analysts' ratings for Rivian vary, with a consensus price target of $15.83.