Rivian has bad news for hundreds of its workers

Rivian spent years selling the thought that it could go the adjacent large American carmaker. Its trucks won awards. Its marque built a pursuing astir bequest automakers would envy. Amazon (AMZN) placed a ample transportation van bid and an aboriginal equity bet. For a institution that has ne'er posted an yearly profit, the full communicative rested connected 1 promise, that a cheaper, higher measurement conveyance would yet crook each that attraction into earnings.

That conveyance is the R2, a midsize athletics inferior conveyance (SUV) built astir a promised basal terms adjacent $45,000 that began reaching buyers successful June 2026. It is the astir important motorboat Rivian has ever attempted. Which is what makes the timing of the adjacent determination truthful jarring.

Rivian laid disconnected hundreds of workers connected Tuesday, June 16, astir 1 week aft the archetypal R2 deliveries. The cuts touched little than 2% of its workforce and fell mostly connected work and lawsuit teams. Rivian said it had "restructured a fistful of teams" arsenic it works to standard the concern profitably, according to CNBC.

Why Rivian is cutting jobs during its biggest launch

The size of the chopped is small. The awesome is not. Rivian employed 15,232 radical astatine the extremity of past year, truthful little than 2% works retired to up to astir 300 jobs, according to Electrek.

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When I lined up the transportation number against the losses, the logic down trimming unit stopped looking similar a mystery. Rivian mislaid $3.6 cardinal past twelvemonth portion delivering 42,247 vehicles, according to CNBC. Its automotive conception mislaid astir $6,000 connected each conveyance it sold successful the archetypal 4th of 2026. Selling much cars, astatine that rate, deepens the spread alternatively than filling it. The R2 is expected to interruption that signifier by spreading fixed costs crossed acold much units.

A institution successful that spot has fewer levers left. It cannot rise prices connected a exemplary designed to beryllium affordable. It cannot conjure R2 measurement overnight. So it pulls the lever that protects currency fastest, fixed costs, and payroll is the largest fixed outgo astir companies carry. 

Related: Rivian gets superior astir challenging Tesla FSD with latest move

What the layoffs accidental astir Rivian's way to profit

This is astatine slightest the 4th circular of cuts Rivian has made since the commencement of 2024, a signifier that says the compression is structural alternatively than seasonal.