Rivian Automotive, a manufacturer of electric trucks, announced it’s laying off 6% of its workers in an effort to save money in preparation for a potential price war across the market.
In an email to employees, the company’s CEO, RJ Scaringe, stressed that improving operating efficiency must be a “key aim.” In addition to developing its next similar R2 vehicle platform, the company is concentrating on increasing production for its R1 trucks and the EDV delivery vans it built for Amazon.
Scaringe said that the cuts would not affect manufacturing jobs at their Illinois factory.
In late 2021, Rivian successfully floated its initial offering, raising close to $12 billion. However, since then, shares of the California-based automaker have lost about 90% of their value, forcing the business to reevaluate its expansion plans as it strives to become profitable. There are worries that other manufacturers may be pushed to lower costs on EVs due to increased competition in the market as a result of recent price war reductions by Tesla and Ford Motor.
After incurring losses of $5 billion throughout the first three quarters of 2022, Rivian had around $13.8 billion in cash left as of the end of September. The business reported that it fell just short of its target of building 25,000 vehicles in 2022 last month.
After the U.S. markets close on February 28, Rivian will release its results for the fourth quarter and the entire year.
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