Rivian (RIVN) is cutting another 1% of jobs

Rivian (RIVN) is cutting more jobs as the EV maker aims to improve profitability. This is the second round of layoffs this year, but it’s only 1% of the workforce this time.

Rivian is cutting another 1% of jobs

“This was a difficult decision, but a necessary one to support our goal to be gross margin positive by the end of the year,” Rivian said in an emailed statement (via Automotive News).

Rivian plans to cut another 1% of its workforce as the automaker works to improve profitability by the end of the year.

The statement read, “We continue to work to right-size the business and ensure alignment to our priorities.” This is the second round of layoffs from the EV startup this year.

After releasing its fourth quarter and full-year 2024 earnings in February, Rivian announced it was laying off 10% of its salaried employees.

Rivian’s CEO, RJ Scaringe, said the move was to “maximize the amount of impact we can have as a company” on the company’s media call. Scaringe explained that Rivian is “not immune to existing economic and geopolitical uncertainties.”

Rivian R1T (left) and R1S (right) (Source: Rivian)

Rivian beat expectations, delivering 13,588 vehicles in the first quarter. Meanwhile, the EV maker officially shut down production at its Normal, IL manufacturing plant earlier this month for upgrades.

The upgrades are expected to “meaningfully reduce” material costs by the end of the year. Scaringe said a “whole host of changes” will be introduced, resulting in a “dramatic cost reduction” for the R1S and R1T.

Rivian R1S production (Source: Rivian)

Rivian lost $43,372 per vehicle built in the fourth quarter. Although that’s up slightly from Q3 ($30,500), it’s still down significantly from the over $124,000 loss per vehicle in Q4 2022.

Following the plant upgrades, Rivian believes it can achieve a modest growth profit in the fourth quarter.

Q3 ’22 Q4 ’22 Q1 ’23 Q2 ’23 Q3 ’23 Q4 ’23
Rivian loss per vehicle $139,277 $124,162 $67,329 $32,594 $30,500 $43,372
Rivian loss per vehicle by quarter

Rivian cutting additional jobs comes after Tesla announced it was reducing its global workforce by more than 10% this week.

Rivian’s stock ended Wednesday near all-time lows of around $8.74 per share. That’s down over 58% in 2024 and 93% from its all-time high of $172 per share shortly after going public in November 2021.

Rivian (RIVN) stock chart over the past 12 months (Source: TradingView)

Electrek’s Take

Although it may seem extreme, another 1% cut is not massive. Rivian wants to hit its goal of becoming gross margin positive and believes it can do it with a smaller workforce.

Once its Normal plant reopens, it will go from three shifts to two. However, all assembly line workers will remain. Tim Fallon, executive vice president of manufacturing in Normal, explained, “We are increasing the overall capacity and efficiency of our lines.”

In addition, “we’re making a lot of upgrades to our vehicles, many that you won’t see, but they help us with our costs,” Fallon told the Chicago Tribune.

Rivian has already established itself as a true luxury EV competitor. Its R1S electric SUV was the fourth best-selling EV in the US in the first quarter.

Last month, Rivian unveiled its next-gen R2, a smaller, more affordable electric SUV. It will start at around $45,000 as Rivian expands its market. Rivian also teased an even more compact and affordable R3 and R3X.

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