Rivian announced a $120 million investment to construct a supplier park near its Normal, Illinois facility, aiming to streamline logistics and cut costs. The park will support the production of the upcoming R2 SUVs, slated to begin next year, alongside the existing R1S SUVs, R1T pickup trucks, and commercial vans.

CEO RJ Scaringe emphasized that the supplier park will significantly boost production capabilities, particularly as the company prepares to manufacture the R2 model in 2026. By having suppliers manufacture and assemble components on-site, Rivian plans to reduce shipping, warehousing, and overall logistics expenses. These parts will then be transported to the main plant via an underground tunnel.

The initiative is expected to generate hundreds of jobs over the next two years, with approximately 100 positions created directly by Rivian. This move comes as Rivian seeks to conserve cash and accelerate the production timeline for the R2, which is considered critical for the company's success amid a slowing electric vehicle market.

To further optimize resources, Rivian had previously paused construction on a separate plant in Georgia, opting instead to initiate R2 production at the Normal facility. The company intends to eventually manufacture the R2 SUVs and R3 crossovers at the Georgia plant starting in 2028.

In April, Rivian reported a 36% decline in first-quarter deliveries, attributed to soft demand and the impact of fires in Los Angeles. CFO Claire McDonough had indicated earlier in February that vehicle deliveries would be lower throughout the year.

Rivian's investment also addresses challenges related to tariffs imposed on vehicle and auto part imports, which have the potential to disrupt supply chains and increase automobile prices. While Rivian assembles its vehicles in the U.S., it relies on imported parts. Recent measures taken by U.S. President Donald Trump aim to mitigate the impact of these tariffs through a combination of credits and relief from other levies on materials.