Oct 23 (Reuters) - Rivian Automotive ( RIVN ) is laying

off 4.5% of its workforce, or over 600 employees, an internal

email showed on Thursday, as the electric-vehicle maker contends

with weakening demand following the expiry of key U.S. tax

credits.

The expiration last month of a $7,500 U.S. federal tax credit

for purchases and leases of new EVs has largely boosted prices

and is expected to hit sales through the rest of the year for

automakers such as Rivian already grappling with mounting cost

pressures.

"These are not changes that were made lightly," Chief

Executive Officer RJ Scaringe said in an email to staff. "With

the changing operating backdrop, we had to rethink how we are

scaling our go-to-market functions."

The layoffs are part of a consolidation of various

operations into Rivian's service, sales and marketing units,

Scaringe said. He added the company also planned to hire a chief

marketing officer.

Rivian shares closed 1.3% higher on Thursday.

Rivian has struggled to achieve consistent profitability due to

costs related to ramping up production, President Donald Trump's

tariffs on imported parts and intense competition from Tesla

and traditional automakers.

High tariffs on imported auto parts have driven up manufacturing

costs and forced EV makers to revamp supply chains, curb

reliance on foreign components and boost U.S. investment in line

with administration policy.

Analysts expect Rivian's quarterly revenue to surge 71.5%

and loss to narrow, when it reports third-quarter results after

markets close on November 4.

This month, the company lowered the midpoint of its annual

deliveries forecast, despite reporting a nearly 32% jump in the

third quarter, largely driven by a last-minute rush to grab the

now-expired federal incentive.

Rivian is focusing on improving manufacturing efficiency and

streamlining operations at its Normal, Illinois plant to align

costs with the weaker near-term demand outlook, while preparing

for its next-generation R2 models, which are expected to broaden

its reach beyond the luxury segment.

The company expects the R2 model to open up a lower-price

segment, competing with Tesla's best-selling Model Y crossover,

and counterbalance soft demand for its pricier R1 vehicles.