Rivian Automotive plans to increase initial production capacity for its Georgia plant by 50%, boosting annual output to 300,000 units for its mid-sized R2 vehicles. The electric vehicle maker disclosed this expansion while reporting higher revenue in its latest quarter, maintaining its production target for late 2028.

The capacity increase comes as Rivian bets heavily on its more affordable R2 SUV amid a challenging US EV market following tax credit eliminations. By scaling up production, Rivian aims to reduce costs per unit while preserving room for future expansion as it competes in an increasingly crowded electric vehicle space.

To accelerate the additional capacity, Rivian modified its agreement with the Energy Department, securing up to $4.5 billion for the facility's initial phase. The company now expects to begin drawing from these funds by early 2027, positioning itself to capitalize on growing demand for electric vehicles despite current market headwinds.