CEO Scaringe says Rivian will ‘be as thoughtful as possible’ as he considers job cuts

Rivian founder and CEO RJ Scaringe has confirmed layoffs are being considered as the electric carmaker seeks to “grow sustainably” in the face of a changing economic landscape.

There is still no indication as to whether or how the layoffs would impact Rivian’s normal manufacturing facility, which has about 6,000 employees. Bloomberg reported on Monday that the cuts would be focused on “non-manufacturing” jobs – perhaps a good sign for Bloomington-Normal. And most of Rivian’s 14,000 employees work elsewhere — in offices in California, Michigan, Arizona, Vancouver and overseas.

In a letter to Rivian employees on Monday evening, Scaringe said the Bloomberg report was “not the way we wanted you to hear about it.” But he confirmed that cost cutting is underway.

“Our team is at the heart of Rivian and we strive to be as thoughtful as possible when considering any reductions,” Scaringe said in the letter shared by Rivian. “We will always be focused on growth. However, Rivian is not immune to the current economic circumstances and we need to ensure that we can grow sustainably. Every decision about our team is evaluated against our strategic priorities, not as a mechanism to simply cut costs. Our team will continue to grow to support our production ramp and product roadmap. »

Production began at Normal’s Rivian plant in September. The start is slower than expected, in part due to global supply chain issues that have disrupted many automakers. A growing number of economists fear that inflation has reached such a high level that the Fed will have to crack down to control prices, which could tip the economy into recession. Over the past few weeks, this fear has led to considerable volatility in the stock market.

Scaringe said some cost-cutting measures were already underway. The company halted some non-manufacturing hiring and enacted “significant” cuts to materials spending and operating expenses.

“We are financially well positioned and our outlook remains strong, but to fully realize our objectives, it is essential that our strategy supports our sustainable growth as we move towards profitability,” Scaringe said.

Rivian has been in the midst of hiring at Normal since late 2020 and has quickly become McLean County’s second largest employer.

Read a full copy of the letter below:

Hello team,

I would like to address the reports circulating on the restructuring of Rivian. The reports extensively speculate on many complex internal discussions about our company, so I wanted to provide some clarity.

As discussed in recent All Hands meetings, we have endeavored to focus our activities in order to stay ahead of the changing economic landscape. We are financially well positioned and our outlook remains strong, but to fully realize our objectives, it is essential that our strategy supports our sustainable growth as we move towards profitability. Earlier this year, we set out our key strategic priorities for the next 18 months:

1) Ramp and improvement of R1 and EDV

2) Accelerate the development of R2

3) Continue to grow our go-to-market capabilities, including our charging and service infrastructure

4) Optimize costs and operating expenses across the business

As a result, we’ve implemented changes to Rivian, including prioritizing certain programs (and halting some), halting some non-manufacturing hires, and embracing major cost-cutting efforts to reduce expenses. materials and operating expenses. We have also begun the process of aligning the organization as a whole to ensure that we are as focused, agile and efficient as possible in achieving our priorities and goals.

The hardest part of this process has been working across our organization to assess the size and structure of our teams and how well this aligns with our strategic plan. Our team is at the heart of Rivian and we strive to be as thoughtful as possible when considering any discounts. We will always focus on growth, however, Rivian is not immune to the current economic circumstances and we need to ensure that we can grow sustainably. Every decision about our team is evaluated against our strategic priorities, not as a mechanism to simply cut costs. Our team will continue to grow to support our production ramp and product roadmap.

That’s not how we wanted you to hear about it. We had hoped that these very sensitive and complex conversations would have remained within Rivian until we could address them more fully. However, because the information is coming out unofficially, I wanted to respond to it personally.

Thank you everyone.

R.J.”