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5 years of Rivian: From 'stealth mode' to one of the biggest IPOs in American history

Scaringe speaks at podium
Bloomington-Normal Economic Development Council
Rivian founder and CEO RJ Scaringe, center, with elected officials, from left, Bill Brady, Chris Koos, Bruce Rauner and Dan Brady inside the plant in March 2017.

It's been five years -- almost to the day -- since the word "Rivian" was first uttered publicly in Bloomington-Normal. Now, the electric automaker is the community's third-largest employer -- with 3,700 workers -- and just wrapped up one of the largest initial public offerings in American history. WGLT's Sound Ideas has this look back at the last five years, from small meetings with taxing bodies ... to stealth mode ... to the Nasdaq.

Technically this story begins six years ago, the end of 2015. That's when Mitsubishi finally stopped production at its Normal manufacturing plant.

The old Diamond Star facility once had 3,000 workers. The final 1,200 lost their jobs when Mitsubishi left town.

Jerry Harcharik spent 27 years at the plant. He spoke then with WGLT about the job hunt AND the grieving process with his co-workers.

Rivian bought the former Mitsubishi plant in Normal for $16 million.

"There is life outside Mitsubishi. You have to look for it. You have to work for it. There is opportunity out there for you, but you have to go out there and grab it," Harcharik said.

Bloomington-Normal's economy is notoriously stable, thanks to stalwarts like State Farm and Illinois State University. But Mitsibushi's closure was a reminder that manufacturing is very, very different. After all, just a few years earlier, then-Gov. Pat Quinn gave Mitsubishi tax incentives to retool the plant to make a new crossover SUV. At the time Mitsubishi said it was fully committed to Normal. Turns out, not so much.

2016: Hello, Normal

Around this time, a young entrepreneur and car geek from MIT named RJ Scaringe was looking to take the next step with his business, now called Rivian.

A liquidator owned the old Mitsubishi plant by now, and Scaringe was looking to see what Rivian could get on the cheap.

"It became very clear that there was a real opportunity for us to not just buy some equipment, but to buy the entire facility," Scaringe told WGLT's Sound Ideas in 2016.

So they did, for $16 million. A relative bargain.

In the community, Scaringe saw a potential partner. After all, Normal had dubbed itself EV Town during a short-lived campaign years earlier, as Mitsubishi was trying to inch into the EV business itself.

"The community that surrounds this facility is really something special. If you look at other plants in the Midwest, and areas affected by their plants shutting down or manufacturing moving out of the area, you don't have this level of energy. You don't have this level of progressive thinking," Scaringe said.

Rivian wanted the plant, but also wanted financial incentives from local governments. Hundred of thousands of dollars in annual property tax breaks, plus a $1 million grant from the Town of Normal. In turn, they were promising 500 full-time workers within five years and a multimillion dollar investment into the plant.

Rivian founder and CEO RJ Scaringe, left, with then-EDC chief Kyle Ham at a Heartland Community College board meeting in 2016.

And many community members were like, wait, who the heck is Rivian?

"They're a technology company that's developing a portfolio of vehicles as well as services to advance a larger shift in sustainable mobility," said Kyle Ham, who at the time was the head of the local Economic Development Council.

Scaringe came on WGLT during the hunt for tax breaks to explain his vision, although it was still vague. Few specifics on the vehicles themselves. More talk about remaking vehicle ownership and shared use.

He told WGLT's Mike McCurdy production would begin in 2019 and sales would begin in early 2020.

"This is like 1992 in the internet days. We are at the very, very beginning of a major transformation in how we look at the customer model with regards to the vehicle," Scaringe said.

Scaringe then made the rounds to city council and school board meetings, trading his now-famous Patagonia look for a suit and tie. He made the pitch to local officials like Rob Widmer, who was then president at Heartland Community College in Normal.

"We look forward to opportunities to partner with Rivian over the years to come, for opportunities for our students to learn and experience what the manufacturing industry is all about -- and research and development in what's going to be a high-tech industry," Widmer said.

The tax breaks were approved. But there was still skepticism around the community. Normal Mayor Chris Koos stressed the hiring and investment benchmarks that Rivian needed to hit to get its money.

"There is a certain amount of risk with any startup operation. Capitalizing the manufacturing of an automobile is a pretty tall order. What people need to realize in terms of the incentives package is that there are no incentives without performance," Koos said.

2017: Stealth mode

After winning those tax breaks, Rivian largely went silent. It spent much of 2017 in what was dubbed "Stealth Mode." That left reporters digging through patent and trademark applications -- anything, really -- looking for clues.

Scaringe says this silent period was deliberate, dating back to when he was working on a sports car. Then they pivoted to something else.

"Because of frankly some of the things we talked too much about in the early days, we made the decision to go deep into stealth mode, and to avoid the distraction of committing to things and making statements that were highly likely to change," Scaringe said.

"They're supportive, but they really want to know what's going on out there."
Normal City Manager Mark Peterson in 2017

A few bits of information trickled out. Rivian picked up smaller investment from Sumitomo Corp., a Japanese company with a U.S. operation based in New York. Abdul Latif Jameel, a global leader in auto distribution, became Rivian's largest shareholder early on, thanks in part to a connection Scaringe made at MIT.

But the public was clamoring for more. Mark Peterson was Normal's city manager at the time.

"People are just curious," said Mark Peterson, who was Normal's city manager in 2017. "They're supportive, but they really want to know what's going on out there. There's a lot to talk about, because they've been working very hard the past 12 months, and I think some of the results of that hard work will become apparent fairly soon."

Chemberly Cummings was elected to the Normal Town Council after the initial Rivian vote. In early 2018, she was concerned by the minimal amount of information Rivian shared with the public and the elected bodies.

“Everything seems very secretive and convoluted at this point,” she said in 2018. “I’m just so nervous we’ll be an episode of ‘American Greed’ one day.”

2018: Opening up

And slowly but surely, Rivian began to open up. In early 2018, Scaringe came back on WGLT's Sound Ideas. They were now talking openly about electric vehicles: a pickup truck and an SUV specifically.

"That brand promise has to transcend all the changes we're going to see over the next 20, 30, 40 years. So the shift away from steering wheels and traditional ownership. The first product is really our handshake with the world to say, We're a brand here to help you engage with life's adventures," said Scaringe.

A few months later, a delegation of local elected and appointed officials -- the same ones that lined up and approved those tax breaks -- made a day trip to Michigan to see Rivian’s vehicle and engineering facility firsthand.

Several attendees came back more optimistic, more assured about the company's trajectory.

Among them was then-Unit 5 Superintendent Mark Daniel. He went in cautiously but came home hopeful about Rivian's ability to impact STEM education in his district.

"It's not a facade. It's happening. It's just a matter of how fortunate they'll be when they launch. I'm looking forward to seeing that time," Daniel said.

Scaringe speaks
Ryan Denham
Rivian founder and CEO RJ Scaringe was the star attraction at the EDC's Community Leaders dinner in October 2018.

Scaringe also did some relationship-building as the star attraction at the EDC's Community Leaders dinner in October 2018. EDC moderator Mike O'Grady asked him who was getting the first Rivian off the assembly line.

"The very first vehicle goes to our largest shareholder. I'm actually fairly far down on the list. Maybe in the first year I'll get one," Scaringe joked with O'Grady.

All of this led to the LA Auto Show just after Thanksgiving 2018. Rivian stole the show with a big reveal of its R1T truck and R1S SUV. Rivian's long battery range and skateboard chassis earned a lot of praise.

WGLT was there to capture the moment, as were celebrity guests like pop star Rihanna, who was dating a Rivian investor at the time and made an appearance at the Griffith Observatory rollout.

The LA Auto Show splash led to real pre-order customers and countless stories in national media about Rivian, many of whom sent reporters to Bloomington-Normal to cover the company's debut.

Scaringe's profile began to grow. He was compared and contrasted over and over again to Tesla's founder Elon Musk. Reporters noted (accurately) how he's a spitting image of Clark Kent.

Scaringe's approach to the spotlight was very different than Musk's. No bluster. Barely used Twitter. Literally just spent years in stealth mode.

He also surrounded himself with auto manufacturing veterans, like Jim Womack, an early advisor and a leading voice on lean business principles.

"He's a real contrast to the kind of predominant model of entrepreneur, which is this very hard-charging kind of guy who's gonna do what it takes to get to be a billionaire. I've known RJ for 10 years, and he has never talked about making money. Never. It's never come up," Womack said on the sidelines of the LA Auto Show.

2019: Big-time investors

All that attention started to turn into real money. The year 2019 was marked with major investment announcements, seemingly every few months.

It was enough to make all those local tax breaks look like small potatoes. In fact, Rivian missed out on one of its first years of local tax breaks because it failed to meet minimum investment thresholds at the Normal plant.

But the big money was there. First Amazon led an investment round of $700 million. Then Ford invested $500 million. Cox Automotive announced another $350 million.

Rivian needed that money to staff up and build out the Normal plant. Other young auto startups have run out of cash at this stage.

In September 2019, Amazon announced it was ordering 100,000 electric delivery vans from Rivian. It was a major turning point, guaranteeing revenue and positioning Rivian at the front lines of corporate climate accountability.

Amazon Rivian van
Amazon announced in September 2019 plans to buy 100,000 electric delivery vehicles from Rivian as part of a larger effort to reduce its carbon footprint.

"This is why we invested in Rivian. We invested $440 million in Rivian. That's part of what I'm so excited about," said Amazon founder Jeff Bezos.

Back in Normal, renovations were well underway at the plant. Several union leaders began to raise concerns that Rivian was using out-of-town workers for some of the remodeling.

“Shame on Rivian for taking tax incentives from the Town of Normal and using those incentives to hire workers from the Chicagoland area,” said Mandy Jo Ganieany of Normal, a district council organizer for the Painters District Council No. 30, in 2019.

The agreement Rivian signed with local governments to win millions in tax breaks did not require the painters and floor polishers and laborers be Bloomington or Normal residents. Union workers did end up getting a lot of work through various remodeling and expansion projects at Rivian.

By fall 2019, Bloomington-Normal residents themselves still hadn't gotten to see the Rivian vehicles themselves up close.

That changed on a Sunday in October, when Rivian held a community event at Uptown Normal circle. New Gov. JB Pritzker was one of the hundreds who showed up.

"I'm thrilled for the people of Normal and for Illinois that we have manufacturing that's reviving in our state. And this is advanced manufacturing, with an advanced vehicle that's the leader in the world," Pritzker said.

2020: Disrupted by COVID

Just like everyone else, 2020 was the year of COVID at Rivian.

The plant in Normal shut down temporarily that spring, although the company said it would keep paying its 300 local workers.

It also meant a delay to the start of vehicle deliveries to customers. That was supposed to be the end of 2020. Rivian now said that wasn't going to happen.

Scaringe said the pandemic impacted "everything from facility construction, to equipment installation, to vehicle component supply -- especially semiconductor chips." He spoke later to Bloomberg about supply chain bottlenecks.

"This is one of those rare situations where 99.5% is not good enough. Meaning if 99.5% of the supply chain is ramping at the same rate as our production, but 0.5% isn't, that creates a constraint or a throttle for how fast we can ramp the rest of the facility," Scaringe said.

2020 was also a tough year on the legal front.

Rivian was hit with a high-profile lawsuit by Tesla, claiming Rivian poached its employees and stole trade secrets. Their friendly rivalry suddenly became not-so-friendly.

A few months later, a coalition of Illinois auto dealers sued Rivian, alleging that its plans to sell EVs directly to consumers—without going through a dealer—are illegal.

More recently, a former female executive filed her own lawsuit claiming she experienced gender discrimination and a “toxic bro culture” during her short tenure with the company. All of those lawsuits remain pending.

2021: Hiring and the IPO

Rivian spent much of 2021 on the march toward going public. Bloomberg first reported back in February that an IPO was possible by the end of the year.

At the time, EV leader Tesla was approaching a trillion-dollar valuation, a sign of how investors were feeling about EVs as the future of transportation.

Rivian founder and CEO RJ Scaringe rings the opening bell of the Nasdaq on Wednesday, Nov. 10, 2021, at the Normal manufacturing plant.
Rivian founder and CEO RJ Scaringe rings the opening bell of the Nasdaq on Nov. 10, 2021, at the Normal manufacturing plant.

"Why you may want to consider going to the public now is the market is pricing you like a technology company, not like a car company," said Jaime Peters, then an assistant professor of accounting and financial services at Illinois Wesleyan University.

And that's how it happened. Rivian started trading on the Nasdaq on Nov. 10, 2021, with Scaringe ringing the opening bell with his family from the floor of the Normal manufacturing plant.

Rivian priced its shares $78 for the IPO. They jumped as high as $170 a share within a week, though it's since come back to earth. It still has a higher market cap than Ford and GM, which make far more vehicles than Rivian.

The day of the IPO, Scaringe thanked his employees, then about 9,300 hundred companywide.

"The most enjoyable part of what we're doing is getting to work with such an incredible team, getting to see all of you pour your heart and soul into what we're building and the impact we're having," Scaringe said.

Rivian also spent most of 2021 on a hiring spree in Normal.

The company added about 3,000 workers in 12 months, making it one of McLean County's largest employers almost overnight. There's so many people they put a fourth Coffee Hound location in the lobby.

What's next: Ramping up production

Now, it's time to make some vehicles. It has over 55,000 preorders for trucks and SUVs, a backlog it expects to take until the end of 2023 to clear. It had only made 180 trucks in the first 6 weeks of production, which began in September. It also has tens of thousands of Amazon delivery vans to make.

“That’s the dance, of keeping the quality high on the R1T, getting the quality ready on the R1S, and keeping those going at the same time,” said Rivian's manufacturing chief, Erik Fields, on a recent plant tour.

"Scaling up to volume -- that's the hell, that's the hard part. And so let's see whether they can pull that off."
Steve Levine, author and EV industry watcher

Rivian has said it doesn’t expect to be profitable “for the foreseeable future,” and that’s not uncommon in the EV world. It took 18 years for Tesla to turn a full-year profit, which it finally did in 2020. That year it made 500,000 vehicles.

The challenge now for Rivian is to ramp up production -- during a tight labor market and supply chain disruptions.

And yes, Rivian won the race to bring the first electric pickup to market. But it won't be alone for long. Ford is famously releasing its electric Ford F-150 Lightning. Tesla has the Cybertruck. GM is doing an all-electric Silverado. And there are SUV competitors too, like the electric Hummer.

"Elon Musk (from Tesla) says it's one thing to create something, but then scaling up to volume -- that's the hell, that's the hard part. And so let's see whether they can pull that off," said author and journalist Steve Levine, who follows the EV industry.

In a way, Bloomington-Normal taxpayers were among Rivian's earliest investors. Rivian has already received $1.8 million in property tax breaks, with one more year to go on its five-year agreement.

Rivian declined, however, to accept the $1 million grant it earned from the Town of Normal. Scaringe told town leaders “the impact of COVID-19 has reminded us all of the importance of community."

That public investment is paying dividends in other ways. The housing market is hot and prices are up. Heartland Community College got $7.5 million from the state to open a new Electric Vehicle–Energy Storage Manufacturing Training Academy.

More could be coming. WGLT first reported this summer that Normal was a finalist community for a new Samsung battery plant that would be build near Rivian. Samsung is Rivian's battery supplier. That could mean thousands more jobs.

Samsung was on the minds of state lawmakers this fall when they passed a tax incentives package they hope will help Illinois become a manufacturing hub for the EV industry. It provides tax credits for income tax withheld for EV manufacturers and costs to train new or retained employees. It also applies to the manufacturers of EV parts, such as batteries.

"Today's bill-signing represents the next step in promoting Illinois as the Silicon Valley of EVs, as we work together to attract new investment from suppliers and other supporting players in this industry," said Rivian public policy chief Jim Chen.

It's another example of policymakers -- using taxpayer money -- taking a risk on something new. Last time that happened, we got Rivian. We'll see what happens in the next 5 years.

Ryan Denham is the digital content director for WGLT.