Rivian Cuts Jobs as Trump's Policies Create a Gap in Its Revenue Strategies | Carscoops

      Rivian has laid off 1.5 percent of its workforce, primarily in the sales and service sectors, and has invited those affected to apply for other roles within the company.

      The company is facing an anticipated revenue loss of $100 million due to changes in credit and policy regulations, as legacy automakers are no longer required to purchase compliance credits from electric vehicle manufacturers.

      Despite the impressive performance of Rivian's R1T and R1S models, their sales volumes are insufficient for the brand to achieve profitability. Consequently, Rivian is planning to introduce a more affordable model line referred to as the R2. As part of the preparations for this launch, the company is seeking to cut costs, which has led to layoffs.

      Rivian has confirmed that it recently eliminated approximately 225 positions, representing around 1.5 percent of its 15,000 employees, with the cuts mainly affecting its commercial division responsible for sales and service in both the United States and Canada.

      In an interview with The Wall Street Journal, a company representative mentioned that laid-off employees are being encouraged to seek other available positions within Rivian.

      The Impact of Trump

      While the reelection of Donald Trump has been beneficial for certain automakers, such as Stellantis with its gasoline-powered Dodge and Ram brands, it has created challenges for electric vehicle manufacturers like Rivian. The U.S. administration has removed penalties for breaching Corporate Average Fuel Economy regulations, which means Rivian will no longer need to sell compliance credits to other manufacturers who don't meet these standards.

      Rivian estimates that this development will lead to a loss of about $100 million in revenue, funds that could have significantly aided the launch of the R2, along with future models like the R3, R4, and R5.

      Industry Adjustments

      Rivian is not the only electric vehicle company adjusting to the new circumstances. Several other automakers are also preparing to cut back on EV production, as the federal EV tax credit will expire on September 30. In Detroit, GM has temporarily laid off around 360 workers for a month to reduce production of the GMC Hummer EV and Cadillac Escalade IQ.