Rivian Electric Vehicle Jump Starter (NASDAQ: RIVN) is laying off 6% of its 14,000 employees, or about 840 positions, according to reports.
“This move will help align our workforce with our key business priorities, including accelerating consumer and commercial vehicle programs, accelerating development of R2 and other future models, rolling out our programs time-to-market and optimizing spend across the business,” according to the news outlets citing a company statement.
“We are deeply grateful for the contribution of every team member who leaves to help make Rivian what it is today. They will always be part of Rivian’s history and community.
Rivian did not immediately respond to a request for comment.
The cost-cutting move is intended to ensure the company can continue to expand its manufacturing operations without raising additional funds, according to Rivian CEO Robert Scaringe in an email to The Wall Street Journal. He said the company’s only manufacturing facility in Normal, Ill., would not be affected by the layoffs.
“Over the past six months, the world has changed dramatically, with inflation reaching record highs, interest rates rising rapidly and commodity prices continuing to climb – all of which have contributed to the tightening of global financial markets” , wrote Scaringe.
Rivian’s stock has been steadily losing ground since its first day of trading in November. On Friday, Rivian closed at $34.30 per share, down more than 80% from its Nov. 16 high of $179.47.
Amazon (NASDAQ: AMZN), Rivian’s largest client and backer, lost $11.5 billion on its investment in Rivian shares in the first six months of 2022. This includes $3.9 billion lost on investment in the second quarter, recorded as non-operating expenses.
Amazon has begun deliveries with Rivian Electric Delivery Vehicles (EDVs), a deployment that “is the start of what Amazon expects to be thousands of EDVs in over 100 cities by the end of 2022 – and 100,000 EDVs across the United States by 2030.” Amazon said in its second quarter results.
The cuts at Rivian follow reports that Xos Trucks has cut its workforce by 8% and layoffs at Canoo, as competition intensifies in the electric vehicle market amid signs of a looming recession.
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