Rivian cuts 1% of workforce in second round of layoffs this year By Reuters

By Abhirup Roy and Akash Sriram

SAN FRANCISCO (Reuters) – Electric vehicle maker Rivian said on Wednesday it was laying off about 1% of its workforce – the second round of job cuts this year – as it cuts costs amid falling demand for EVs.

Rivian shares, up 3.4% during the day, pared almost all of its gains after the news.

“This was a difficult decision, but it is important to support our goal of being positive by the end of the year,” the maker of R1S SUVs and R1T pickup trucks said in an email to Reuters, adding that the cuts were targeted. on the employees who support the business.

The move follows Rivian’s 10% layoff in February when the company disappointed investors with a lower-than-expected 2024 production forecast.

Cost reduction is important for Rivian as high interest rates to control inflation have affected consumer demand for EVs, which are typically more expensive than their gas-powered counterparts.

Rivian has been cutting costs by building some parts in-house and renegotiating supply contracts. It has also shut down its production line for upgrades to increase efficiency and help reduce costs.

The company last month introduced its small and affordable R2 SUV and said it would start producing them at its existing plant in the US instead of a planned new plant, to speed up deliveries in the first half of 2026 and save the company more than $2 billion.

But Rivian shares fell to a record low on Tuesday amid growing concerns about consumer EV sentiment. Companies betting billions of dollars on the future of electricity are now slashing prices to boost demand and cutting costs to reduce cash burn.

Market leader Tesla (NASDAQ: ) is cutting more than 10% of its global workforce, an internal memo seen by Reuters on Monday showed. Ford cut prices on some variants of its F-150 Lightning electric pickup truck by as much as $5,500, the Detroit automaker said last week.

Shares in Rivian, which is due to report first-quarter results on May 7, have lost nearly two-thirds of their value so far this year.