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The all-American EV startup is cutting costs to survive.

America’s most interesting electric-vehicle company is about to have the defining year of its life.
On Wednesday, the company reported that it lost $1.58 billion in the fourth quarter of last year, bringing its net annual losses to $5.4 billion. It announced that it is laying off about 10% of its salaried employees, but — at the same time — promised that it has a plan to achieve a small profit by the end of this year.
Rivian does not seem to be in trouble — not quite yet, at least. But the earnings made clear what electric-vehicle observers have known for a long time: Either the company will emerge from this year poised to be a winner in the EV transition, or it will find itself up against the wall.
That’s partially because Rivian has a stomach-turning number of corporate milestones coming up. Over the next 11 months, it plans to unveil an entirely new line of vehicles, shut down its factory for several weeks for cost-saving upgrades, break ground on a new $5 billion facility in Georgia, and — most importantly — turn a profit for the first time. It also expects to manufacture and deliver roughly another 60,000 vehicles to customers.
Any one of these goals would be difficult to achieve in any environment. But Rivian is going to have to execute all of them during a time defined by “economic and geopolitical uncertainties” and especially high interest rates, its CEO R.J. Scaringe told investors on Wednesday. Since 2021, Rivian’s once robust stockpile of cash has been cut in half to about $7 billion; at its current burn rate, the company will run out of money in a little more than two years.
Although Rivian’s situation is dire, it’s not experiencing anything out of the ordinary. As I’ve written before, the electric truck maker is crossing what commentators sometimes call “the EV valley of death.” This is the challenging point in a company’s life cycle where it has developed a product and scaled it up to production — thereby raising its operating expenses to eye-watering levels — but where its revenue has not yet increased too.
During this vulnerable period, a company essentially burns through its cash on hand in the hope that more customers and serious revenue will soon show up. If those customers don’t arrive, then it either needs to raise more cash … or it runs out of money and goes bankrupt.
It’s a frightening time, but once a company crosses the valley of death, it can reach an idyll. Not so long ago, Tesla found itself in something like Rivian’s position as it prepared to launch the Model 3. Seven years later, it is the most valuable automaker in the world.
Once Rivian’s revenue exceeds its costs, its problems will get easier, or at least more straightforward: Instead of fighting for its survival and watching its cash reserves dwindle, Scaringe will be able to make more strategic trade-offs. Should the company cut costs to expand its profit margin and reward investors, or should it pass the savings along to customers in the form of lower prices, thus growing its market share? Scaringe can’t make these types of decisions until his firm is safely out of the valley.
Claire McDonough, Rivian’s chief financial officer and a former J.P. Morgan director, has a plan for crossing that canyon — an aptly if strangely named “bridge to profitability” that it will attempt to build this year. Rivian’s survival, she said, will depend above all on cutting the unit costs of producing its vehicles, including by using fewer materials to make every car. Other savings will come from making more vehicles faster. That’s what makes the shutdown plan, though it might seem extreme, worth it; McDonough said those improvements alone will get the company about 80% of the way to profitability.
Another 15% will come from marketing more “software-enabled products” to Rivian drivers and by selling air-pollution credits to other carmakers, whose vehicles are not as climate-friendly. This is a tried-and-true technique; Tesla first turned a profit in 2021 by selling regulatory credits needed to comply with federal and California state-level rules to other, dirtier automakers. But that same year, Tesla also debuted an entirely new vehicle: the Model Y crossover, which quickly became its top seller in the United States. Tesla, in other words, finally started to make money by cutting costs, finding new revenue sources, and releasing new products.
New products, however, are becoming a weak point for Rivian. The company says that high interest rates will keep demand for its vehicles flat this year. It expects to make about 60,000 of them, about 20,000 fewer than what it had once anticipated. The Rivian R1S, a three-row S.U.V., has become the company’s flagship; it is selling better and is cheaper to manufacture than Rivian’s pickup, the R1T. It also costs at least $75,000, or nearly $600 a month to lease. The highest-tier models can cost $99,000. Turns out, it’s difficult to sell a lot of $70,000 trucks when even the cheapest new-car loans hover around 6%.
Rivian once had a first-to-market advantage in the electric three-row SUV market, but that may be fizzling out, too. Kia is now selling its own all-electric three-row SUV, the EV9, for $18,000 less than the R1S; in fact, the Kia EV9’s most expensive trim costs $76,000, which is only slightly more than the cheapest R1S. The Kia SUV can also charge faster than the Rivian under ideal conditions. It remains an open question how many rich suburbanites are still interested in buying Rivians, especially now that the Tesla Cybertruck and Ford F-150 Lightning are competing directly with Rivian’s pickup truck.
The company’s hopes, in other words, rest on its next product line: the R2, which it will launch on March 7. We know almost nothing about the R2 line, except that it will probably include an SUV, that it will go on sale in 2026, and that it will fall somewhere in the $45,000 to $55,000 price range. (The median new car transaction in the United States now costs $48,200.) Last year, Scaringe told me that the R2’s timing was perfect because it would fit “beautifully with what we see as this big shift” in the American EV market. In today’s market, he said, “a lot of people ask themselves, Am I gonna get an electric car? Well maybe the next one.” He better hope they’ll start buying that next one in 2026.
Even if they do, Rivian may still have to confront the problem that Tesla has changed the EV market before Rivian could get there. When the first Tesla Model 3s were delivered in 2017, the sedan was instantly one of the best EVs on the market — because it was one of the only EVs on the market. Now every automaker in the world has plans to compete at the Model 3’s price point.
Rivian’s fortunes don’t rest entirely on American consumers; it also sells vans to commercial fleet operators, as well as delivery trucks to Amazon. (Amazon owns about 17% of Rivian.) But that business can be lumpy. Rivian’s vehicle growth slowed down last quarter, for instance, almost entirely because of a near pause in sales to Amazon, which sets up fewer new vehicles in the fourth quarter. If Amazon is willing to bail out Rivian, in other words, it’s not yet clear in the data.
None of this is to say that the company’s outlook is dire. Rivian was always going to find itself at a moment like this, when its expenses exceeded its revenue by such a large amount. The automaker already has devoted fans, and many people — myself included — are interested in the R2 as a potential first EV purchase.
And the company has shown that it can make strides in a single year. Twelve months ago, I had never seen a Rivian on the road before; today, one is regularly parked on my block. The company rocketed from a standing start to become the No. 5 best-selling electric car brand in America last year. What the company has done so far is impressive. But now it must prove that it can be great.
Editor's note: This story has been updated to correctly reflect Rivian's cash burn rate.
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According to a new analysis shared exclusively with Heatmap, coal’s equipment-related outage rate is about twice as high as wind’s.
The Trump administration wants “beautiful clean coal” to return to its place of pride on the electric grid because, it says, wind and solar are just too unreliable. “If we want to keep the lights on and prevent blackouts from happening, then we need to keep our coal plants running. Affordable, reliable and secure energy sources are common sense,” Chris Wright said on X in July, in what has become a steady drumbeat from the administration that has sought to subsidize coal and put a regulatory straitjacket around solar and (especially) wind.
This has meant real money spent in support of existing coal plants. The administration’s emergency order to keep Michigan’s J.H. Campbell coal plant open (“to secure grid reliability”), for example, has cost ratepayers served by Michigan utility Consumers Energy some $80 million all on its own.
But … how reliable is coal, actually? According to an analysis by the Environmental Defense Fund of data from the North American Electric Reliability Corporation, a nonprofit that oversees reliability standards for the grid, coal has the highest “equipment-related outage rate” — essentially, the percentage of time a generator isn’t working because of some kind of mechanical or other issue related to its physical structure — among coal, hydropower, natural gas, nuclear, and wind. Coal’s outage rate was over 12%. Wind’s was about 6.6%.
“When EDF’s team isolated just equipment-related outages, wind energy proved far more reliable than coal, which had the highest outage rate of any source NERC tracks,” EDF told me in an emailed statement.
Coal’s reliability has, in fact, been decreasing, Oliver Chapman, a research analyst at EDF, told me.
NERC has attributed this falling reliability to the changing role of coal in the energy system. Reliability “negatively correlates most strongly to capacity factor,” or how often the plant is running compared to its peak capacity. The data also “aligns with industry statements indicating that reduced investment in maintenance and abnormal cycling that are being adopted primarily in response to rapid changes in the resource mix are negatively impacting baseload coal unit performance.” In other words, coal is struggling to keep up with its changing role in the energy system. That’s due not just to the growth of solar and wind energy, which are inherently (but predictably) variable, but also to natural gas’s increasing prominence on the grid.
“When coal plants are having to be a bit more varied in their generation, we're seeing that wear and tear of those plants is increasing,” Chapman said. “The assumption is that that's only going to go up in future years.”
The issue for any plan to revitalize the coal industry, Chapman told me, is that the forces driving coal into this secondary role — namely the economics of running aging plants compared to natural gas and renewables — do not seem likely to reverse themselves any time soon.
Coal has been “sort of continuously pushed a bit more to the sidelines by renewables and natural gas being cheaper sources for utilities to generate their power. This increased marginalization is going to continue to lead to greater wear and tear on these plants,” Chapman said.
But with electricity demand increasing across the country, coal is being forced into a role that it might not be able to easily — or affordably — play, all while leading to more emissions of sulfur dioxide, nitrogen oxide, particulate matter, mercury, and, of course, carbon dioxide.
The coal system has been beset by a number of high-profile outages recently, including at the largest new coal plant in the country, Sandy Creek in Texas, which could be offline until early 2027, according to the Texas energy market ERCOT and the Institute for Energy Economics and Financial Analysis.
In at least one case, coal’s reliability issues were cited as a reason to keep another coal generating unit open past its planned retirement date.
Last month, Colorado Representative Will Hurd wrote a letter to the Department of Energy asking for emergency action to keep Unit 2 of the Comanche coal plant in Pueblo, Colorado open past its scheduled retirement at the end of his year. Hurd cited “mechanical and regulatory constraints” for the larger Unit 3 as a justification for keeping Unit 2 open, to fill in the generation gap left by the larger unit. In a filing by Xcel and several Colorado state energy officials also requesting delaying the retirement of Unit 2, they disclosed that the larger Unit 3 “experienced an unplanned outage and is offline through at least June 2026.”
Reliability issues aside, high electricity demand may turn into short-term profits at all levels of the coal industry, from the miners to the power plants.
At the same time the Trump administration is pushing coal plants to stay open past their scheduled retirement, the Energy Information Administration is forecasting that natural gas prices will continue to rise, which could lead to increased use of coal for electricity generation. The EIA forecasts that the 2025 average price of natural gas for power plants will rise 37% from 2024 levels.
Analysts at S&P Global Commodity Insights project “a continued rebound in thermal coal consumption throughout 2026 as thermal coal prices remain competitive with short-term natural gas prices encouraging gas-to-coal switching,” S&P coal analyst Wendy Schallom told me in an email.
“Stronger power demand, rising natural gas prices, delayed coal retirements, stockpiles trending lower, and strong thermal coal exports are vital to U.S. coal revival in 2025 and 2026.”
And we’re all going to be paying the price.
Rural Marylanders have asked for the president’s help to oppose the data center-related development — but so far they haven’t gotten it.
A transmission line in Maryland is pitting rural conservatives against Big Tech in a way that highlights the growing political sensitivities of the data center backlash. Opponents of the project want President Trump to intervene, but they’re worried he’ll ignore them — or even side with the data center developers.
The Piedmont Reliability Project would connect the Peach Bottom nuclear plant in southern Pennsylvania to electricity customers in northern Virginia, i.e.data centers, most likely. To get from A to B, the power line would have to criss-cross agricultural lands between Baltimore, Maryland and the Washington D.C. area.
As we chronicle time and time again in The Fight, residents in farming communities are fighting back aggressively – protesting, petitioning, suing and yelling loudly. Things have gotten so tense that some are refusing to let representatives for Piedmont’s developer, PSEG, onto their properties, and a court battle is currently underway over giving the company federal marshal protection amid threats from landowners.
Exacerbating the situation is a quirk we don’t often deal with in The Fight. Unlike energy generation projects, which are usually subject to local review, transmission sits entirely under the purview of Maryland’s Public Service Commission, a five-member board consisting entirely of Democrats appointed by current Governor Wes Moore – a rumored candidate for the 2028 Democratic presidential nomination. It’s going to be months before the PSC formally considers the Piedmont project, and it likely won’t issue a decision until 2027 – a date convenient for Moore, as it’s right after he’s up for re-election. Moore last month expressed “concerns” about the project’s development process, but has brushed aside calls to take a personal position on whether it should ultimately be built.
Enter a potential Trump card that could force Moore’s hand. In early October, commissioners and state legislators representing Carroll County – one of the farm-heavy counties in Piedmont’s path – sent Trump a letter requesting that he intervene in the case before the commission. The letter followed previous examples of Trump coming in to kill planned projects, including the Grain Belt Express transmission line and a Tennessee Valley Authority gas plant in Tennessee that was relocated after lobbying from a country rock musician.
One of the letter’s lead signatories was Kenneth Kiler, president of the Carroll County Board of Commissioners, who told me this lobbying effort will soon expand beyond Trump to the Agriculture and Energy Departments. He’s hoping regulators weigh in before PJM, the regional grid operator overseeing Mid-Atlantic states. “We’re hoping they go to PJM and say, ‘You’re supposed to be managing the grid, and if you were properly managing the grid you wouldn’t need to build a transmission line through a state you’re not giving power to.’”
Part of the reason why these efforts are expanding, though, is that it’s been more than a month since they sent their letter, and they’ve heard nothing but radio silence from the White House.
“My worry is that I think President Trump likes and sees the need for data centers. They take a lot of water and a lot of electric [power],” Kiler, a Republican, told me in an interview. “He’s conservative, he values property rights, but I’m not sure that he’s not wanting data centers so badly that he feels this request is justified.”
Kiler told me the plan to kill the transmission line centers hinges on delaying development long enough that interest rates, inflation and rising demand for electricity make it too painful and inconvenient to build it through his resentful community. It’s easy to believe the federal government flexing its muscle here would help with that, either by drawing out the decision-making or employing some other as yet unforeseen stall tactic. “That’s why we’re doing this second letter to the Secretary of Agriculture and Secretary of Energy asking them for help. I think they may be more sympathetic than the president,” Kiler said.
At the moment, Kiler thinks the odds of Piedmont’s construction come down to a coin flip – 50-50. “They’re running straight through us for data centers. We want this project stopped, and we’ll fight as well as we can, but it just seems like ultimately they’re going to do it,” he confessed to me.
Thus is the predicament of the rural Marylander. On the one hand, Kiler’s situation represents a great opportunity for a GOP president to come in and stand with his base against a would-be presidential candidate. On the other, data center development and artificial intelligence represent one of the president’s few economic bright spots, and he has dedicated copious policy attention to expanding growth in this precise avenue of the tech sector. It’s hard to imagine something less “energy dominance” than killing a transmission line.
The White House did not respond to a request for comment.
Plus more of the week’s most important fights around renewable energy.
1. Wayne County, Nebraska – The Trump administration fined Orsted during the government shutdown for allegedly killing bald eagles at two of its wind projects, the first indications of financial penalties for energy companies under Trump’s wind industry crackdown.
2. Ocean County, New Jersey – Speaking of wind, I broke news earlier this week that one of the nation’s largest renewable energy projects is now deceased: the Leading Light offshore wind project.
3. Dane County, Wisconsin – The fight over a ginormous data center development out here is turning into perhaps one of the nation’s most important local conflicts over AI and land use.
4. Hardeman County, Texas – It’s not all bad news today for renewable energy – because it never really is.