SAN FRANCISCO, April 17 (Reuters) - Electric vehicle

maker Rivian said on Wednesday it cut about 1% of its

workforce - the second round of job cuts this year - as it

reduces cost amid a broader slowdown in EV demand.

Shares of Rivian, up as much as 3.4% on Wednesday, pared

almost all of its gains after the news. The shares closed up 1%

on Thursday.

"This was a difficult decision, but a necessary one to

support our goal to be gross margin positive by the end of the

year," the maker of R1S SUVs and R1T pickup trucks said in an

email to Reuters, adding that the cuts were focused on staff

supporting the business.

The move follows a 10% layoff at Rivian in February when the

company disappointed investors with a lower-than-expected 2024

production forecast. As of Dec. 31, Rivian had 16,790 employees

across North America and Europe, according to its annual report.

Reducing cost is crucial for Rivian as high interest rates

to rein in inflation have hurt consumer demand for EVs that are

typically more expensive than their gas-powered counterparts.

Rivian has been reducing costs by building some parts in

house and re-negotiating supply contracts. It has also shut down

its production line for an upgrade to increase efficiency and

help reduce cost.

The company last month introduced its smaller, less

expensive R2 SUVs and said it would start producing them at its

existing U.S. factory instead of a planned new plant, to hasten

deliveries in the first half of 2026 and save the company more

than $2 billion.

But shares of Rivian hit a record low on Tuesday amid

intensifying concerns around the souring consumer EV sentiment.

Companies that bet billions of dollars on an all-electric future

are now cutting prices to stoke demand and reducing costs to

limit cash burn.

Market leader Tesla is laying off more than 10% of its

global workforce, an internal memo seen by Reuters on Monday

showed. Ford cut prices of some variants of its F-150

Lightning electric pickup truck by as much as $5,500, the

Detroit automaker said last week.

Shares in Rivian, which is set to report first-quarter

results on May 7, have lost nearly two-thirds of their value so

far this year. Wednesday's layoffs were first reported by an

online media outlet called EV.