You might know Rivian Automotive (NASDAQ:RIVN) as a manufacturer of electric vehicles (EVs), primarily trucks and SUVs. However, RIVN stock traders are grappling with the company’s recent announcement. Apparently, Rivian is venturing into the intriguing field known as micromobility.
In this instance, micromobility is a fancy way of saying electric bikes, also known as e-bikes. At a conference in October 2022, CEO R. J. Scaringe hinted at Rivian’s potential move into the micromobility field. At that time, however, the chief executive didn’t make a formal announcement about this and didn’t state that any specific micromobility products were in the works.
At a company-wide meeting on Friday, however, Scaringe reportedly disclosed that a small group of engineers is “actively working on” developing e-bikes. Per Bloomberg, it’s not currently known whether Rivian’s potential e-bikes would be battery-electric motorcycles or bicycles. The company does have patents for electric bicycle components and designs, though, so this may provide a clue to curious onlookers and investors.
What’s Happening With RIVN Stock?
RIVN stock barely moved this morning, so it seems financial traders are still deciding how to respond to Scaringe’s announcement. There is another news item for Rivian’s shareholders to consider, though.
Specifically, the company is currently implementing cost-cutting efforts. The automaker plans to reduce its headcount by 6%, and this will be Rivian’s second major round of layoffs during the past year.
It might be confusing to hear Rivian wants to reduce its expenditures but also intends to start up an e-bike business. At the same time, some of Rivian’s loyal shareholders might wonder whether the company will achieve profitability in the near future.
Along with those issues, investors may question whether Rivian will succeed in its apparent foray into micromobility. That remains to be seen, and today’s traders are undoubtedly weighing these considerations as they buy and sell RIVN stock.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.