According to rumors, Rivian (NASDAQ: RIVN) is cutting off 6% of its 14,000-person workforce, or approximately 840 positions.
According to news organizations citing a company statement, “this decision will help align our workforce to our key business priorities, including ramping up the consumer and commercial vehicle programs, accelerating the development of R2 and other future models, deploying our go-to-market programs, and optimizing spend across the business.”
“We’re appreciative for each departing team member’s effort to make Rivian what it is today.” They will be a part of the Rivian story and community for the rest of their lives.”
Rivian did not reply quickly to a request for comment.
According to Rivian CEO Robert Scaringe in an email to the Wall Street Journal, the cost-cutting initiative is intended to ensure the company can continue to grow its manufacturing operations without obtaining further funding. It was reported that the layoffs will not affect the company’s single production site in Normal, Illinois.
“Over the last six months, the world has significantly transformed,” Scaringe said, “with inflation reaching record highs, interest rates fast rising, and commodity prices continuing to rise – all of which have led to global financial markets tightening.”
Rivian’s stock has continuously declined since its initial public offering in November. Rivian ended at $34.30 per share on Friday, down more than 80% from its high of $179.47 on Nov. 16.
Rivian’s EDV is made for Amazon. (Photo courtesy of Rivian)
Over the first six months of 2022, Amazon (NASDAQ: AMZN), Rivian’s top customer and supporter, lost $11.5 billion on its Rivian stock investment. This includes a $3.9 billion investment loss in the second quarter, which was recognized as a non-operating charge.
Rivian’s layoffs follow reports of Xos Trucks laying off 8% of its workers and Canoo layoffs, as competition in the EV sector heats up amid warnings of an approaching recession.
Amazon has begun deliveries with Rivian electric delivery vehicles (EDVs), a rollout that “marks the beginning of what Amazon plans to be thousands of EDVs in more than 100 locations by the end of 2022 — and 100,000 EDVs across the United States by 2030,” according to the company’s second-quarter results.
