Layoffs 2023: FedEx, Rivian And REI Announce Job Cuts, Hundreds Affected

Massive layoffs for the first quarter of the year are not done yet as FedEx, Rivian and REI will sack hundreds of employees this February.

In an announcement on Wednesday, FedEx CEO Raj Subramaniam said the company is cutting more than 10% of its officers and directors to cut costs amid decreasing customer demand.

"Unfortunately, this was a necessary action to become a more efficient, agile organization. It is my responsibility to look critically at the business and determine where we can be stronger by better aligning the size of our network with customer demand," Subramaniam wrote.

Like most package and shipping companies, FedEx experienced a surge during the pandemic amid the online shopping boom. However, inflation has affected consumers, and more people went back to establishments, causing FedEx's profits to fall roughly 20% last year.

The company aims to cut about $3.7 billion in total during this fiscal year, according to a CNBC report.

Another company, Rivian Automotive, is set to lay off 6% of its workforce to cut costs due to its falling cash reserves and a weak economy, Reuters reported.

The automotive company is also reportedly preparing for a possible industry-wide price war.

In an email to employees obtained by Reuters Wednesday, Rivian Chief Executive R.J. Scaringe said the company will focus resources on vehicle production and reaching profitability. In January, the company reported that it did not reach its goal of producing 25,000 vehicles in 2022.

The company currently has 14,000 employees.

Recreational Equipment, Inc. (REI), a local outdoor co-op, has also announced layoffs for profitability.

In a message to employees dated Jan. 31, REI Chief Executive Eric Artz said 167 of its employees would terminated, citing the need to get "back to profitability as quickly as possible," CNBC's King 5 reported.

"We have clear goals for the future of the co-op and are confident in our long-term strategies," Artz' said, as quoted by King 5. "But in the face of increasing uncertainty, we need to sharpen our focus on the most critical investments and areas of work to best serve our members and grow the Co-op over the long term. We will need to make hard choices, and that will be the work ahead for all of us."

Eligible full-time employees will be offered a severance package, according to the report. Those affected will have access to four months of health care, receive pay for remaining vacation time and 2022 bonuses and get other support.