This editorial appeared in the Oct. 18, 2019, edition of the Chicago Tribune:
Illinois doesn't see many unicorns. But there's been a sighting in downstate Normal, where an electric truck manufacturer called Rivian operates out of the former Mitsubishi auto plant.
A unicorn is a privately held startup company worth at least $1 billion. Rivian's unexpected rise is worthy of comparison to the mythological creature: The company, based in Michigan, arrived in Normal several years ago with mysterious plans to develop some sort of advanced vehicle.
Who were the investors? What was the business model? Rivian founder RJ Scaringe has a doctorate from MIT but he wasn't big on answering questions. He did ask for money, though, seeking property tax incentives from Normal officials, who were desperate to replace the thousands of jobs lost when Mitsubishi bailed. Normal officials took a risk and supported Rivian. "I do believe they are a credible organization," Mayor Chris Koos said in late 2016.
Rivian eventually unveiled prototypes and confirmed its heady prospects by attracting big-league investors. This year, Amazon led a group that put $700 million into the company. Ford followed with $500 million and a plan to co-develop an electric vehicle using Rivian's platform. Then Cox Automotive provided $350 million. Rivian, which is developing an electric truck and SUV, is now worth $3.5 billion, according to The Wall Street Journal. Amazon has ordered 100,000 custom electric delivery vehicles.
A few days ago, Rivian held an open house in Normal to show off prototypes. The company has 156 employees and isn't scheduled to roll its first electric vehicles off the line for another year. But Scaringe says, "We're talking about thousands of jobs," according to the Tribune's Robert Channick. The company's getting $4 million in local incentives plus $49.2 million in state tax credits over 15 years if it meets employment and investment targets.
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It all still feels slightly unreal — yes, like a unicorn — but that's the nature of the startup field, where money chases ideas, only some of which lead to profitable, sustainable businesses. What makes the Rivian story compelling is the company's decision to locate a promising high-tech operation in a shuttered downstate factory. Mitsubishi's departure in 2015 felt like a death in the family. Here we have a rebirth.
Illinois shouldn't ever be scrounging for jobs and investment. This is a manufacturing state at the crossroads of America that boasts a highly trained workforce and superb higher education options.
The challenge in attracting businesses to Illinois is the state's reputation for an unfriendly business environment: high taxes, lots of regulatory red tape and a crushing government debt load scare away investors. Foreign vehicles companies and suppliers would rather locate in places like Indiana, a fiscally sound, right-to-work state.
Mitsubishi left Illinois because its business was ailing, but Indiana is home to Toyota, Subaru and Honda.
Now here comes Rivian. The sooner Illinois makes itself more attractive to other employers, the more success the state will have creating jobs, and luring unicorns.