How Georgia outbid Fort Price for a $ 5 billion electrical automobile plant in Rivia

Electric vehicle maker Rivian is building its $ 5 billion facility in east Atlanta, foregoing Fort Worth for an investment expected to create 7,500 or more jobs.

Over the summer, Fort Worth City Council approved a $ 440 million tax incentive package for the company if it chose to locate its new factory on property southwest of downtown Fort Worth.

The total number of incentives Georgia Rivian has offered has not been publicly disclosed, but the Atlanta Journal-Constitution reports that the number is expected to be “staggering.”

Georgia Governor Brian Kemp, standing next to a sign that read “# 1 State For Business,” told the media and public who gathered to announce that Rivian’s work was the largest single economic development project in the state’s history is.

“Today is just the beginning of a generational partnership,” said Kemp.

Kemp rattled off a list of factors that played a role in the enticement of the project. He cited investments in education, the Port of Savannah, workforce development efforts, and the state track record of attracting a Kia plant.

Fort Worth’s director of economic development, Robert Sturns, told The Dallas Morning News that the city and its private and public stakeholders had made a “great team effort.”

He compared Georgia’s selection to losing the Super Bowl to just a field goal.

“I don’t think I’d say our efforts really lacked. I think Georgia just outperformed us,” said Sturns.

Sturns said the Walsh family, the private owners of the property offered as part of the Fort Worth package for Rivian, pushed the deal hard and played the offer competitive. And the city has the backing of the state, he said.

He pointed to one tool that Georgia could make in Rivian’s appeal – the state’s ability to buy land and offer it for major economic development projects.

“I think it found the secret sauce for some of the deals they were able to close,” said Sturns. “The state can try to do some things that could lower the total land cost, or give the land free if that was something it wanted and make up for those costs.”

Fort Worth will continue to work with the Walsh family to find a tenant for the property, and Sturns said they see opportunities for a wide range of industrial uses and corporate locations.

Fort Worth recently saw rare earth materials giant MP Materials selected AllianceTexas to host its new magnet factory, which will supply critical parts for EV motors and other green technologies. Sturns said he was optimistic about the interesting pipeline for economic development in Fort Worth.

Georgia has become an alleged competitor for the plant in recent weeks after Fort Worth officials said they were waiting for Rivian’s news of the deal.

Texas Electric Transportation Resources Alliance director Tom “Smitty” Smith said he believes Texas will lose out in the next few years with investments in electric vehicle manufacturing. He referred to the recent decision by the electric vehicle manufacturer Canoo to set up its first plant in Oklahoma instead of Texas, although it is only headquartered here for a short time.

“We have to be really aggressive to make sure we get the closest manufacturing facilities in Texas instead of losing elsewhere,” said Smith.

Toyota North America, based in Plano, recently announced an EV battery plant for North Carolina and may be looking to locate a similar plant elsewhere. General Motors, which already has a critical assembly plant in Arlington, could also expand in the future.

Last year Rivian applied for $ 7 million worth of permits to build or renovate service centers for its vehicles and charging stations across Texas. The company also made attempts in the last legislative term to advocate spin-offs in state law that would allow it to bypass dealers and sell its vehicles directly to consumers. These efforts were unsuccessful.

Rivian has been heralded by investors and analysts as the only American manufacturer of electric vehicles to rival the incumbent Tesla. It just completed a gigantic IPO that raised $ 12 billion.

The company released its third quarter results simultaneously with the Georgia announcement on Thursday, revealing that it is generating revenue for the first time.

The company posted more than $ 1 billion in losses for the quarter and had sales of $ 1 million. It has reported that it has shipped its first 11 R1T trucks – the EV maker’s flagship pickup truck that was recently named Truck of the Year 2022 by MotorTrend.

And while Georgia may have won that round, Smith said he felt Rivian missed a “huge market opportunity” in Texas.

“It’s the largest market in the country for pickup trucks and light trucks,” said Smith.