Michigan-based Rivian Automotive is negotiating to buy the former Mitsubishi Motors (7211.T) plant in Normal, Illinois, and plans to reopen it in about five years, city and state officials said Thursday.
The seven-year-old company, which has facilities in suburban Detroit and San Francisco, plans to invest up to $175 million in the Normal plant by 2024, according to the Illinois Department of Commerce.
Rivian aims to build an electric vehicle with self-driving capability, according to a source familiar with the company's plans.
A press release issued late Thursday by the state said Rivian is "developing an integrated portfolio of vehicles and services to advance the shift to sustainable mobility."
Mayor Chris Koos told Reuters on Friday that Rivian would employ about 500 people at the factory when it reopens in 2021 and eventually would have about 1,000 workers. It has been closed since May.
He said he did not know the purchase price of the transaction, which is to close on Jan. 3.
Rivian could not be reached for comment on Friday.
Rivian was founded in 2009 by R.J. Scaringe, chief executive officer, and employs more than 50 people, according to its LinkedIn profile. "Rivian is creating solutions that redefine traditional automotive economics and remove the pain points of conventional ownership," the profile says.
Scaringe's individual profile lists a doctorate in mechanical engineering from Massachusetts Institute of Technology but no previous automotive experience.
Chief Operating Officer Gabriel Mesanza previously worked for General Motors Co (GM.N) and later was a consultant at Deloitte and KPMG, according to his profile.
Rivian has recruited several automotive veterans, including Chief Engineer Lawrence Achram, a former Chrysler vice president, and Design Director Larry Erickson, a former designer at GM and Ford Motor Co (F.N), according to their LinkedIn profiles.
Koos said liquidation service Maynards Industries bought the plant from Mitsubishi and was planning to auction off its equipment in September and then raze the building. Those plans changed when Rivian put up $1 million in "earnest money" on a potential purchase, he said.
Normal will host Rivian executives on Monday as the company seeks approval for tax breaks by the city and other local governments, Koos said.
Mitsubishi had used the plant as a hub for production of its Outlander SUV before announcing its closure in January, resulting in the layoff of about 1,000 workers. At its peak, the plant employed 3,000.
(Reporting by Bernie Woodall and Paul Lienert in Detroit; Editing by Lisa Von Ahn and Grant McCool)