Just weeks before federal subsidies end for electric vehicles, the automaker Rivian is laying off hundreds of its workforce.
The company said the cuts are part of an overall plan to streamline production ahead of its release next year of a smaller SUV.
“We have made some recent changes to the commercial team as part of an ongoing effort to improve operational efficiency for R2,” a spokesperson for the Irvine-based EV company said.
That team includes sales and service employees, who are eligible for rehire to other positions within the company.
Rivian, which makes the R1S SUV at a price tag of more than $70,000 and the R1T pickup truck ($72,000-$129,000), also is working on the smaller, $45,000 R2 at its assembly plant in Normal, Illinois.
Rivian’s commercial division stretches across the automaker’s engineering, software and design hubs in Irvine, Palo Alto and Carson, plus its new East Coast headquarters in Atlanta.
The layoffs come just before the $7,500 tax credit to buy electric vehicles is set to expire Sept. 30 under President Donald Trump’s policy changes. Also ending this month is the federal Clean Air Vehicle decal program, which enabled EV and hybrid car owners to ride in the carpool lane with just a single occupant.
“It’s a bump in the road,” said Jessica Caldwell, head of Insight, a division within Santa Monica-based Edmunds that analyzes the automotive industry and consumer behavior. “It has been helpful to have the tax credit because it has really gone a long way to subsidize the lease payments, and when that is gone, it’s going to suddenly create a much more expensive lease.”
Forecasting the right workforce balance to deal with supply and consumer demand at an EV manufacturer like Rivian is tough, according to Caldwell.
“They’re just taking best guesses at how they should be staffed to meet these demands. It’s really hard in the electric vehicle sector right now. The move to electrification is happening whether anyone likes it or not. The timeline is sort of in the air right now because of things like tariffs, consumer acceptance and infrastructure build outs. There are a lot of questions,” she said. “Trying to mitigate through all of this is quite challenging. The market is so hard to read right now.”
In July, Rivian reported $1.7 billion in losses in its first six months of 2025, and has been cutting expenses throughout its organization in response to the sales slowdown.
The automaker, which doesn’t break out the number of employees by location, had 14,861 people on its payroll across North America as of Dec. 31, 2024. Rivian has made repeated workforce adjustments over the past two years, including another cut of about 150 workers in June.
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While Rivian is a small player in the EV market, its share is rising as the company led by RJ Scaringe gets production up at its Illinois plant and begins work on a second facility in Georgia. A $6.6 billion loan from the U.S. Energy Department under President Joe Biden and another $5 billion commitment from Volkswagen is helping boost the new automaker’s production.
Tim Fallon, Rivian’s vice president of manufacturing, said in a 2024 interview at Rivian’s Normal, Illinois, plant that the EV-maker had well over 100,000 pre-orders for its $45,000 R2 vehicle, which is due to market in 2026.
This summer, Rivian completed a sprawling expansion of its Normal factory. The new capacity will help the company grow its annual capacity to 215,000 vehicles.
In January, Rivian reported it built 49,476 EVs in 2024 after lowering its estimate from 57,000 a few months earlier. The company blamed a component shortage that has since been resolved.
In the three months that ended in July, the company said that it produced 5,974 vehicles in Normal and delivered 10,661 vehicles. The automaker also reaffirmed its 2025 delivery guidance range to 46,000 vehicles from 40,000.