Electrical carmaker Rivian mentioned on Wednesday that it is going to be slicing 10% of its salaried workforce because it offers with slowing EV demand.
The corporate made the announcement in its 2023 fourth quarter earnings name on Wednesday.
The This autumn monetary report additionally revealed that regardless of making and delivering twice as many EVs in 2023 as in 2022, the corporate nonetheless noticed a $5.4 billion revenue loss for the yr.
And for 2024, Rivian expects to provide across the similar variety of automobiles — about 57,000 — because it did in 2023. That is a lot decrease than the 80,000 automobiles that analysts forecasted the corporate could be producing in 2024, in keeping with Bloomberg.
In an electronic mail to Enterprise Insider, Rivian didn’t specify precisely what number of salaried employees members could be reduce, however mentioned that it has 16,700 whole workers, together with each salaried and hourly staff.
That is the corporate’s third spherical of layoffs within the final yr and a half — it reduce 6% of its employees in February 2023 and one other 6% in July 2022, Business Insider previously reported.
“Rivian, like different automakers, is going through the music of financial uncertainty, shoppers’ waning enchantment with EVs, and strict federal tax credit score guidelines,” Insider Intelligence senior analyst Jacob Bourne mentioned.
“The posh-end of the EV market is changing into saturated and so Rivian is aware of its greatest guess is to intention for higher affordability, Bourne added. “The query is whether or not its upcoming R2 SUV will hit the candy spot for EV customers this yr. Whereas it seeks to spice up gross sales, layoffs and a decline in battery steel costs might launch the strain valve.”
This is the total electronic mail that Rivian CEO RJ Scaringe despatched out to employees on Wednesday, asserting that layoffs could be approaching Thursday.
Hello Staff,
Staff adjustments are the toughest choices I need to make as CEO. I’ve some troublesome information to share. Tomorrow, we’re lowering our salaried workers by roughly 10% together with a restricted variety of non-manufacturing hourly workers. I wish to offer you some extra context on how we got here to this determination.
Our enterprise is going through a difficult macroeconomic surroundings—together with traditionally excessive rates of interest and geopolitical uncertainty—and we have to make purposeful adjustments now to make sure our promising future. We should strategically prioritize our development areas of the enterprise, together with the launch of Peregrine and R2 in addition to investing in our go-to-market capabilities. We have just lately carried out a number of organizational and management adjustments, however we have to do extra to realize our strategic priorities.
Tomorrow, February 22, workers who’re impacted will obtain a calendar invite between 7:30 and eight a.m. PT for a 1:1 assembly with their supervisor later that very same morning. We all know the timing right here is troublesome – ready between now and tomorrow to grasp whether or not you are impacted is much from excellent, however we wish to guarantee a thoughtful notification course of that accommodates all time zones. We will probably be doing the whole lot we are able to to assist our impacted colleagues by the separation course of, together with severance, eligibility for Rivian-paid COBRA advantages protection and entry to job placement providers. Additionally, anybody impacted tomorrow will nonetheless be eligible for our FY’23 bonus.
I acknowledge saying goodbye to pals and colleagues is not straightforward. I am grateful for everybody’s contributions, and for individuals who depart us, I wish to thanks deeply for the whole lot you’ve got carried out for Rivian, and for what you’ve got carried out to advance our mission.
