EV maker Rivian has implemented another round of layoffs, cutting approximately 1% of its workforce -- the company's second job cut this year.
According to Reuters, Rivian said April 17 these cuts are a part of a broader cost-reduction effort, as the company pushes to achieve a gross margin positive status by year-end.
"This was a difficult decision, but a necessary one to support our goal to be gross margin positive by the end of the year," a company spokesperson said in an email to Reuters. The layoffs primarily affected personnel in business support roles.
These layoffs follow a substantial 10% workforce reduction in February, triggered by a disappointing production forecast for 2024. Rivian is navigating high interest rates and a general slowdown in consumer demand for more expensive electric vehicles.
In an effort to counterbalance these challenges, Rivian has taken several measures to streamline operations and reduce expenses. The company has begun manufacturing certain parts in-house and renegotiated supply contracts to lower costs. Additionally, it paused its production line for upgrades to enhance efficiency.
Rivian's strategy also includes adjusting its production plans for new models. In March, the company announced the introduction of the smaller, less expensive R2 SUVs. Originally planned to be produced at a new facility in Georgia, these vehicles will now be manufactured at Rivian's existing factory in Illinois. This shift is expected to expedite deliveries slated for the first half of 2026 and save the company more than $2 billion.
Despite these efforts, Rivian's stock hit a record low April 16, reflecting broader market concerns about the cooling demand for consumer EVs. With its first-quarter results due May 7, Rivian's shares have plunged nearly two-thirds in value since the beginning of the year.
