Hundreds of Rivian employees could be losing their jobs soon.
The popular automaker is allegedly considering a mass layoff of about five percent of its workforce soon due to the losses it incurred last year, per The Verge.
Rivian recently expanded itself to further ramp up its production of electric vehicles (EVs). It had produced more than 2,500 vehicles to date since the start of 2022.
Rivian Potential Mass Layoff Details
Although the company has yet to give an official announcement, it is allegedly considering laying off about five percent of its 14,000 employees. This percentage means that around 700 Rivian employees are at risk of losing their jobs soon if Rivian goes through with its plan.
The mass layoff specifically targets employees whose jobs were added as it scaled up and that aren’t involved in manufacturing, per Engadget.
As such, Rivian employees with jobs that are for non-manufacturing positions in areas where Rivian has expanded too quickly, and those with duplicate functions are the most at risk of being laid off.
Rivian’s employees have more or less doubled in size since 2021 to better manufacture and increase EV production.
Rivian has a good reason for laying off hundreds of its employees. Although the company produced around 2,553 EVs and had delivered 1,227 of them as part of its efforts of making 25,000 before the end of 2022, it still lost around $1.59 billion during the last quarter.
Rivian’s losses could be attributed to the company’s struggles to cope with global supply-chain breakdowns and parts shortages, according to Bloomberg.
Additionally, automakers are currently facing broader hurdles as vehicle sales, including EVs, soften with customers being put off by high sticker prices.
Sources familiar with the matter also mentioned to Bloomberg that the company grew too quickly for its income to support itself and its employees.
These sources asked Bloomberg to remain unidentified for them to keep their jobs.
In the meantime, the company can utilize its almost $17 billion cash and restricted cash on its balance sheet to get through the supply-chain breakdowns and parts shortages.
Other Tech Companies Laying Off Employees
Rivian is not the only company considering a mass layoff of employees. Tesla is also planning on laying off 10% of its workforce and Better.com let go of “a small number” of employees by giving them their severance pay a day before their termination notice.
Meanwhile, Netflix laid off 300 employees as part of its latest round of layoffs to help itself stay afloat due to declining subscriber counts, per Variety.
Tesla has also fired around 500 employees to reduce its salaried workforce by 10% while growing the number of hourly employees at the same time.
However, Tesla is no stranger to mass layoffs and production delays. It was still able to produce about 259,000 EVs and deliver 255,000 during 2022’s second quearter despite the ongoing semiconductor shortage, supply-chain breakdowns, and parts shortages, per Tesla’s announcement.
Keyword: Rivian is Allegedly Planning to Lay Off Hundreds of Workers