By Michael Elkins
Shares of Rivian (NASDAQ:RIVN) were down 3.6% in early trading on Friday after Ford (NYSE:F) cut their stake in the electric vehicle company to 1.15%. The decision by Ford comes a week after the Detroit automaker reported a fall in profit and predicted a tough year ahead.
The cut also follows reports that the EV startup plans to lay off 6% of its staff to cut costs amid falling cash reserves on the back of mounting economic worries. Rivian shares also had a bleak 2022, losing about 82% of their value.
Ford has been paring down its stake amid production struggles at the Irvine, California-based company. Ford held a 11.4% stake in Rivian at the end of 2021.
Rivian has been losing money on every vehicle it builds, and narrowly missed its full-year production target of 25,000 units last year as it dealt with supply-chain disruptions.
Recently, Rivian has had to deal with demand shifts as electric vehicle giant, Tesla (NASDAQ:TSLA) cut prices. However, the EV giant's China website showed a slight increase in the price of its base Model Y in China, hinting at a possible shift in the EV price war.
Shares of F are up 0.43% in mid-day trading on Friday while shares of RIVN and TSLA are down 2.37% and 4.28% respectively.