Rivian CEO RJ Scaringe sent an internal memo to employees Thursday announcing the company’s third workforce reduction in four months, cutting roughly 600 jobs as the electric vehicle maker struggles with collapsed post-tax-credit demand. The carefully worded message emphasized “structural adjustments” for the upcoming R2 launch while conspicuously avoiding the financial crisis threatening the company’s survival.

The layoffs—affecting approximately 4.5% of Rivian’s 15,000-person workforce—come just one day after Scaringe promoted the company’s ALSO e-bike spinoff to media, highlighting the jarring contrast between Rivian’s public optimism and private cost-cutting. The timing speaks volumes about the EV startup’s precarious position as it races to launch the $45,000 R2 SUV in early 2026 while burning through what remains of its once-massive cash reserves.

The Memo: Corporate Speak Meets Crisis Management

In the memo viewed by Business Insider, Scaringe framed the cuts as strategic positioning rather than desperate measures. “With the launch of R2 in front of us and the need to profitably scale our business, we have made the very difficult decision to make a number of structural adjustments to our teams,” he wrote. “These changes result in a reduction in the size of our team by roughly 4.5%.”

The CEO acknowledged the human cost with measured corporate language: “These are not changes that were made lightly. With the changing operating backdrop, we had to rethink how we are scaling our go-to-market functions. This news is challenging to hear, and the hard work and contributions of the team members who are leaving are greatly appreciated.”

But what’s most revealing isn’t what Scaringe said—it’s what he carefully avoided mentioning. The memo makes zero reference to the September 30 expiration of federal EV tax credits, which eliminated up to $7,500 in savings for new EV buyers under President Trump’s “One Big Beautiful Bill.” It doesn’t acknowledge this is the third layoff round since June. And it certainly doesn’t mention that Rivian has burned through more than $12 billion since its 2021 IPO, with less than $6 billion remaining and quarterly losses exceeding $1 billion.

Reorganization Details: Streamlining or Scrambling?

The memo outlined two primary organizational changes, both affecting customer-facing functions that generate no revenue during Rivian’s current production constraints.

Customer Operations Consolidation: Scaringe announced integrating Vehicle Operations into the Service organization “to create fewer customer handoffs and clearer ownership.” Delivery and Mobile Operations will fold into Sales “to ensure the purchase experience is as seamless as possible with a single touchpoint throughout the entire sales process and to delivery.”

Marketing Restructure: Perhaps most telling, Rivian is consolidating multiple marketing functions into a single organization while searching for its first Chief Marketing Officer. Until that hire, Scaringe will serve as interim CMO—adding another executive role to his plate while the company fights for survival. “While we recruit our first Chief Marketing Officer, I will be acting as Interim CMO,” he wrote.

The CEO specifically named two teams reporting directly to him during the transition: the Marketing Experiences team led by Denise Cherry and the Creative Studio team under Matt Soldan. This level of detail about org-chart reshuffling while cutting hundreds of jobs reads more like damage control than strategic vision.

What The Memo Conveniently Omits

En Wall Street Journal first reported the layoffs Thursday, noting they primarily target sales, marketing, and customer service departments—leaving manufacturing operations untouched as Rivian prepares for R2 production ramp-up at its Normal, Illinois facility.

What Scaringe’s memo doesn’t mention is the broader context EVXL readers already know well. We’ve been documenting Rivian’s mounting struggles for months:

These cuts follow a 10% workforce reduction in February 2024 and additional layoffs in June
Rivian reported a $1.115 billion net loss in Q2 2025 on just 10,661 deliveries
The company announced a $250 million IPO fraud settlement the same day as these layoffs
Third-quarter 2025 EV sales hit records as buyers rushed to claim tax credits before the September 30 deadline, but that temporary spike masked the coming demand cliff

The memo’s reference to a “changing operating backdrop” is corporate euphemism for “federal tax credits that propped up our industry just vanished, and we’re about to find out if anyone will pay $45,000 for an R2 without government subsidies.”

The R2 Gambit: All-In On Affordable EVs

Scaringe called the R2 “an inflection point for us to become a company of the scale we aspire to be, which is producing many millions of cars a year” during Wednesday’s ALSO unveiling event. That ambitious vision contrasts sharply with Thursday’s workforce cuts targeting the very departments needed to sell those millions of vehicles.

The R2 launches in the first half of 2026 with a targeted starting price of $45,000, positioning it against the Tesla Model Y and Ford Mustang Mach-E in the competitive compact electric SUV segment. Rivian delivered 13,200 vehicles in the third quarter—a 32% year-over-year increase—but narrowed its full-year guidance to 41,500-43,500 units amid post-tax-credit uncertainty.

The company maintains it has sufficient capital to reach R2 production, bolstered by Volkswagen’s $5 billion joint venture investment. But with quarterly losses exceeding $1 billion and production volumes still in the low tens of thousands, Rivian is betting everything on the R2 resonating with mainstream buyers who no longer receive thousands in federal incentives.

EVXL’s Take

Let’s decode what’s really happening here. Rivian just announced its third workforce reduction in four months—a 4.5% cut following previous rounds that already slashed more than 10% of staff. The company settled a $250 million fraud lawsuit the same morning it sent this memo. And it’s burning through its remaining $6 billion in cash at more than $1 billion per quarter while producing vehicles in the low five figures.

Yet Scaringe’s memo reads like a routine organizational efficiency exercise, complete with org-chart minutiae about which VP reports to which interim executive. The corporate euphemisms—“structural adjustments,” “changing operating backdrop,” “scaling our go-to-market functions”—carefully avoid the uncomfortable truth that Rivian is in crisis mode.

This isn’t restructuring. This is a company desperately trying to reach the R2 launch with enough cash and credibility intact to convince consumers they’ll be around to honor warranties. The fact that Scaringe is taking on the interim CMO role himself while searching for a permanent hire suggests either leadership churn or an inability to attract top talent to a sinking ship—or both.

We’ve seen this movie before with EV startups. Lordstown Motors collapsed. Fisker filed for bankruptcy. Lucid keeps cutting staff while surviving on Saudi money. The difference is Rivian actually builds compelling vehicles and has a legitimate manufacturing operation. But compelling vehicles don’t matter if you run out of money before reaching profitable scale.

The R2 at $45,000 without tax credits needs to be good enough to steal significant market share from Tesla, Ford, and Hyundai. That’s a massive ask for a company that’s never turned a profit, just cut hundreds of customer-facing employees, and is asking its CEO to moonlight as CMO while running product development and operations.

Read Scaringe’s memo carefully. Notice what he emphasizes—organizational efficiency, R2 preparation, streamlined customer journeys. Then notice what he doesn’t mention—the third layoff round in four months, the collapsed tax credit support, the $250 million fraud settlement announced the same day, or the very real possibility that Rivian might not survive to see the R2’s second model year.

The corporate messaging is masterful. The underlying reality is terrifying.

What do you think? Share your thoughts in the comments below.