Following reports that it might cut as many as 700 employees, Rivian’s CEO R.J. Scaringe has addressed the cuts with employees, confirming the cuts, according to a letter shared with Carscoops.
“We’ve implemented changes across Rivian, including prioritizing certain programs (and stopping some), halting certain non-manufacturing hiring and adopting major cost down efforts to reduce material spend and operating expenses,” Scaringe wrote in the letter to employees. “We also began the process of aligning the organization as a whole to ensure we are as focused, nimble and efficient as possible to achieve our priorities and objectives.”
The CEO was clear, though, that the company is “financially well positioned” and its “outlook remains strong.” He admitted, though, that “to fully realize our objectives it is critical that our strategy supports our sustainable growth.”
“Rivian is not immune to the current economic circumstances, and we need to make sure we can grow sustainably,” wrote Scaringe. “Every decision about our team is being assessed through the lens of our strategic priorities, not as a mechanism to simply reduce costs.”
The letter did not address how many people would be cut, but reports from earlier this week suggested that the company may be looking to target an overall reduction of five percent. As Rivian currently employs 14,000, that could amount to as many as 700 people.
Rivian has offices in California, Michigan, and Illinois, as well as in the U.K. and Canada. In order to support its production ramp-up, the company roughly doubled its headcount last year. Unnamed sources told Bloomberg that it was looking to get rid of teams with duplicate functions, but that it would preserve manufacturing jobs.
That will be important since ramping up production is the biggest challenge the automaker faces, at least publicly. Production setbacks and higher-than-expected costs have conspired to severely impact Rivian’s stock price, though its Q2 performance has provided it with a glimmer of hope.
Scaringe, meanwhile, reiterated to his company that ramping up and enhancing the R1T and R1S as well as its delivery vehicle, accelerating development of the R2 series, ramping up its “go-to-market capabilities,” and optimizing costs and operating expenses were Rivian’s top four priorities for the next 18 months. He said that more information would be shared at an all-hands meeting on Friday.