Rivian Shaken by Unexpected Layoffs

By Douglas A. McIntyre Published Sep 5, 9:15AM EDT

Quick Read

Layoffs at Rivian Automotive Inc. (NASDAQ: RIVN) are just the latest bad news from the EV maker.
A new, cheaper model comes too late to help the company survive.

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Rivian Shaken by Unexpected Layoffs — © yacobchuk / Getty Images

It was in big headline letters in The Wall Street Journal: “Rivian Lays Off Workers as It Preps Launch of Cheaper SUV.” It was just the latest in a turntable of bad news from the battered electric vehicle (EV) maker. Wall Street’s sentiment about Rivian Automotive Inc. (NASDAQ: RIVN | RIVN Price Prediction) shows up in its stock price, which is down 90% in the past five years. The S&P 500 has gained 38% in that time. Rivian is so small that its tiny share of the EV business in the United States is not meaningful.

Rivian recently said it would come to market with its R2 SUV, which is priced at about $44,000. It arrives too late for a company that has overpriced its current products. Its R1T pickup and R1S SUV, its only other products, have starting prices of $70,990 and $76,900, respectively. With extra features, those prices rise closer to $100,000. That is a huge disadvantage in a market that is waiting for EVs priced below $25,000, which many Chinese EVs are already.

Rivian produced 5,979 vehicles in the second quarter and delivered 10,661 vehicles during the same period. Production was down 22% from the same quarter a year ago.

Rivian announced earnings recently that are another reminder of how small the chance is that it can survive as larger companies try to shoehorn themselves into the market. On the one side is Tesla, wounded but the U.S. market share leader. On the other side are legacy behemoths like GM that have invested tens of billions of dollars in what they still see as the future of the industry.

In the second quarter, Rivian’s loss was higher than expected. It had supply chain problems because of rare earth issues, brought on by a trade war with China. Its adjusted loss was $0.80 per share, against Wall Street expectations of $0.65. The bottom line will be worse than expected at a $2.0 billion to $2.3 billion loss this year. That is much more than the $1.7 billion to $1.9 billion loss management had forecast earlier.

Even with a new, cheaper one, any changes to its models come too late.

Rivian Stock Price Prediction and Forecast 2025-2030

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.