Rivian (RIVN) is cutting another 1% of jobs as the EV maker works toward profitability

Rivian (RIVN) is cutting more jobs as the EV maker goals to enhance profitability. This is the second round of layoffs this 12 months, however it’s just one% 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 chop another 1% of its workforce as the automaker works to enhance profitability by the end of the 12 months.

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 12 months.

After releasing its fourth quarter and full-year 2024 earnings in February, Rivian announced it was shedding 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 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 12 months. Scaringe said a “whole host of changes” will likely be introduced, leading to a “dramatic cost reduction” for the R1S and R1T.

Rivian lost $43,372 per vehicle inbuilt the fourth quarter. Although that’s up barely 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 might probably achieve a modest growth profit in the fourth quarter.

Rivian cutting additional jobs comes after Tesla announced it was reducing its global workforce by greater 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.

Electrek’s Take

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

Once its Normal plant reopens, it can go from three shifts to 2. However, all assembly line staff will remain. Tim Fallon, executive vp 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 real 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 cost-effective electric SUV. It will start at around $45,000 as Rivian expands its market. Rivian also teased a fair more compact and reasonably priced R3 and R3X.