Rivian announces plans to layoff 840 workers amid EV price wars

Yahoo Finance automotive reporter Pras Subramanian explains Rivian's recent round of layoffs amid pressures to ramp up its EV production targets.

Video transcript

SEANA SMITH: All right, well, Rivian laying off 6% of its workforce in an effort to achieve profitability amid a growing price war in the EV market. Senior autos reporter Pras Subramanian joining us now with more. And Pras, it's certainly a tough setup here for Rivian because we have the price war that's brewing, also just a challenging economic environment right now.

PRAS SUBRAMANAIAN: Yeah, I mean, $90,000 trucks are not exactly an easy sell sometimes, but we confirmed that they are laying off 6% of their staff here, non-factory jobs. It's going to be operational people, marketing people, people like that in their corporate offices. So, really all about cost control, controlling expenses. They want to build these cars cheaper. And they're kind of getting killed on margins here.

So it basically kind of follows a second round of layoffs they had earlier last year. And the company also dropped-- remember, it dropped this deal with Mercedes to build EV vans. They're pushing back their cheaper R2 vehicles. So really just the effort to conserve cash, focus on building these cars cheaper, and getting them to customers as soon as possible.

DAVE BRIGGS: Boy, it is a nice-looking truck, isn't it, we see on that video.

PRAS SUBRAMANAIAN: We had it. It was great.

DAVE BRIGGS: Oh, man.