Rivian announces 6% cut in its workforce

Rivian announced this week that they have decided to trim their existing workforce by 6%. Hence, it has become part of the group of companies who have laid off employees in wake of recession concerns. However, Rivian claims that their decision to lay off employees is to focus on its electric pickup truck production ramp.

Strategic decision by Rivian

There were numerous rumors over the past few weeks that the company will lay off employees. However, Rivian’s CEO said that this is a strategic decision and they are focusing on realizing their full potential.

“Over the last six months, the world has dramatically changed with inflation reaching record highs, interest rates rapidly rising and commodity prices continuing to climb — all of which have contributed to the global capital markets tightening. We are financially well positioned and our mission is more important than ever, but to fully realize our potential, our strategy must support our sustainable growth as we ramp toward profitability. We need to be able to continue to grow and scale without additional financing in this macro environment. To achieve this, we have simplified our product roadmap and focused on where it is most impactful to deploy capital.” CEO RJ Scaringe confirmed it in an email to employees.

Severance package for parting employees

Rivian have an employee base of more than 14,000 workers across the United States. Therefore, a cut of 6% jobs means that it will affect around 840 jobs. The company spokesman claimed the layoff plan will not affect the regular manufacturing jobs. In addition, there are 161 open positions at company’s website on Wednesday. However, employees working supply chain and logistics, IT, and other areas are at risk of losing their jobs. Furthermore, Rivian will offer 14-week regular pay, health coverage Rivian-paid COBRA benefits and continuation of mental health and fertility benefits through the end of the year. In addition, they will also offer job placement assistance for the leaving employees.

Tesla also announced to laying off 10% of their salaried workforce a few months back.

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