Rivian to lay off 6% of workforce as EV price war concerns grow

Employees examine a Rivian R1T electrical automobile (EV) pickup truck on the assembly line at the company’s producing facility in Typical, Illinois, US., on Monday, April 11, 2022.

Jamie Kelter Davis | Bloomberg | Getty Photographs

Electrical truck maker Rivian Automotive stated it is laying off 6% of its workforce in a bid to preserve funds as it braces for a attainable market-vast rate war.

In an electronic mail to staff that was witnessed by CNBC, CEO RJ Scaringe explained increasing the company’s functioning effectiveness ought to be a “main goal.” The company is focusing on ramping up creation of its R1 vehicles and the EDV shipping and delivery vans it builds for Amazon, as properly as on progress of its forthcoming lesser R2 motor vehicle platform.

Scaringe stated that the cuts would not impact production positions at Rivian’s factory in Illinois.

Rivian went community via a prosperous preliminary supplying in late 2021, increasing approximately $12 billion. But the California-based automaker’s shares have shed nearly 90% of their price given that, leading the enterprise to rethink its enlargement strategies as it works toward profitability. The latest rate cuts by Tesla and Ford Motor have led to fears that other automakers may perhaps be pressured to lower charges on EVs amid rising opposition in the area.

Rivian had about $13.8 billion in dollars remaining as of the conclude of September, soon after posting losses of $5 billion as a result of the very first a few quarters of 2022. The corporation claimed last thirty day period that it fell slightly short of its aim of developing 25,000 cars in 2022.

Rivian will report its fourth-quarter and complete-yr outcomes following the U.S. markets close Feb. 28.

Particulars of Scaringe’s e mail have been first documented by Reuters. The enterprise has about 14,000 staff.