Rivian Layoff 10% Staff and Lowers Production Forecast for 2024

[Gr8Barn]

Rivian to Cut 10% of Salaried Staff, Citing Economic Uncertainty
https://www.bloomberg.com/news/arti...of-salaried-staff-citing-economic-uncertainty

Rivian Automotive Inc. revealed plans to cut 10% of its salaried workforce and set production plans well below Wall Street’s expectations as the maker of electric vehicles grapples with stagnant demand and economic turbulence.

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[s00n]

https://techcrunch.com/2024/02/21/rivian-lays-off-10-of-workforce-as-ev-pricing-pressure-mounts/amp/

Same news, but what is Peregrine?

 

[GogglesPisano]

Yup, and stock tanks as a result. I think Rivian's guidance has always been to under promise. Obviously this isn't going to be a banner year with interest rates the way they are, but I bet their real internal estimate is more than a duplicate of last year.

The layoffs are concerning though, but likely on the heels of the hard development that went into the R2 and to make way for the employment bump coming as the Georgia plant starts to break ground. Right now they need to focus their resources on staying afloat until R2 rolls of the line.

That said, if anybody was waiting to get an R1, I'd do it now. Why do you ask? Because the refresh is likely to have some cost cuts and more cutting will come in the years following. You'll lose little niceties that add up to dollars for Rivian. This first edition of both vehicles was exactly how they wanted everything to be, design, components, quality, etc. These cars should cost a lot more than what we paid which is what new companies need to draw interest. Your first shot needs to be a slam dunk and aside from some new car issues, I feel like it's a solid package. The next version might not be noticeably different, but I be you it's going to be a lot of small things like the number of fasteners, metal gauge, number of welds, frame parts, plastic parts going from paint to mold in color, metal finishes changing, wrapped parts going to straight plastic, etc.

Same thing that Tesla went through.

 

[GogglesPisano]

https://techcrunch.com/2024/02/21/rivian-lays-off-10-of-workforce-as-ev-pricing-pressure-mounts/amp/

Same news, but what is Peregrine?

It's the R2 architecture that future vehicles will be built on

 

[Supratachophobia]

Yup, and stock tanks as a result. I think Rivian's guidance has always been to under promise. Obviously this isn't going to be a banner year with interest rates the way they are, but I bet their real internal estimate is more than a duplicate of last year.

The layoffs are concerning though, but likely on the heels of the hard development that went into the R2 and to make way for the employment bump coming as the Georgia plant starts to break ground. Right now they need to focus their resources on staying afloat until R2 rolls of the line.

That said, if anybody was waiting to get an R1, I'd do it now. Why do you ask? Because the refresh is likely to have some cost cuts and more cutting will come in the years following. You'll lose little niceties that add up to dollars for Rivian. This first edition of both vehicles was exactly how they wanted everything to be, design, components, quality, etc. These cars should cost a lot more than what we paid which is what new companies need to draw interest. Your first shot needs to be a slam dunk and aside from some new car issues, I feel like it's a solid package. The next version might not be noticeably different, but I be you it's going to be a lot of small things like the number of fasteners, metal gauge, number of welds, frame parts, plastic parts going from paint to mold in color, metal finishes changing, wrapped parts going to straight plastic, etc.

Same thing that Tesla went through.

Ehhhh, on model 3 and model y, for sure. But on S, the interior only got better. Now, they were Tesla-better so no Lexus.

 

[linkwpc]

Time to buy more stock

 

[TollKeeper]

Time to buy more stock

Indeed

 

[Electrified Outdoors]

What am I missing? Sharers tanked but it looks like it's at $15.39.

I see these as positive things. Rivian is making adjustments to ensure they are on target to launch R2. That Georgia factory is going to cost a lot of money and they're going to need to hire a lot of folks to work it.

I think there will be cost cutting that occurs this year and they're going to look to continue to bring down losses. We're still early in the year though and a lot of things can change. First of all, gas prices are down from last year, which I believe is why we are seeing all the negative sentiment from the news media. When gas prices are low nobody needs EVs. Then when gas prices are four and $5 a gallon, we don't want to drive gas anymore. Everybody needs to buy an EV. The news media changes with the wind sometimes.

High interest rates have definitely made it more costly to borrow. And also Rivian knew that these vehicles were not mainstream high volume. They are expensive vehicles and so the pool of buyers is naturally going to be smaller. The lack of increasing production is most likely going to be due to the changes that they're making in the spring where they're shutting down assembly and I would imagine it's going to take them some time to ramp back up from that.

I have faith that Rivian is going to be just fine and what we're seeing now is temporary. I want to see where we are in June.

As for the stock, that's a long play. I don't even want to think about the price of the stock until 2026 2027 time frame.

 

[COdogman]

I hate to see anyone get laid off, but it’s hard to ever say just how much of a sign it is for the company overall. I feel like pretty much any company could lose 10% of salaried workers at any time and be completely fine.

 

[Blakejakely]

What am I missing? Sharers tanked but it looks like it's at $15.39.

After hours trading. It'll be lower in the morning. Google's stock ticket shows after hours value

 

[elektrode]

What am I missing? Sharers tanked but it looks like it's at $15.39.

down 13% in after hours

 

[carsly]

Sadly, this was predictable.

However, I think the Standard and Standard+ packs and the lower entry point when coupled with the dual motor puts R1's into a better demand space. Unfortunately, that $75-85K space is saturated -- and getting worse:

- Macan EV
- Volvo EX90
- Polestar 3
- Cadillac Lyriq
- Hummer EV 2

What else? Could be too many vehicles chasing too few buyers - at least until interest rates drop.

 

[invernite]

It's the R2 architecture that future vehicles will be built on

An engineer I know at Rivian said Peregrine is their internal code name for the R1 refresh.

 

[R1Tom]

I hate to see anyone get laid off, but it’s hard to ever say just how much of a sign it is for the company overall. I feel like pretty much any company could lose 10% of salaried workers at any time and be completely fine.

Unfortunately my guess is it will be more than 10% over the next few years. It's a long road and time till R2's are actually sellable to the public. I am sure they figured that in when deciding to build a plant from ground up. Not sure they recognized the limited market for the R1 however.

But there is a big gap in time now from stagnant R1 sales and R2 production.

I still wish they had figured out a way to get R2's out quicker by using existing facilities.

 

[s4wrxttcs]

I hate to see anyone get laid off, but it’s hard to ever say just how much of a sign it is for the company overall. I feel like pretty much any company could lose 10% of salaried workers at any time and be completely fine.

You just have to avoid cutting the 10% that do 80% of the work.

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