Mr. Chen, a former Tesla Inc. TSLA 7.74% executive who joined Rivian in 2018, led the company’s state-by-state fight to enable direct-to-consumer sales, a core business strategy for pure-play EV makers like Rivian and Tesla, who do not use traditional dealerships to sell cars. The company announced that he is expected to leave Rivian at the end of February.
His departure comes after a number of other senior executives left the company in recent months, including the general counsel and supply chain head, and Rivian is looking to cut costs to conserve cash.
A spokeswoman for Rivian said Mr Chen is leaving the company by mutual consent and has expressed a desire to spend more time with his family and to travel.
“I’m proud of the work we’ve done, the impact we’ve had and the team we’ve built,” Mr. Chen said in an emailed statement.
At Rivian, Mr. Chen was tasked with lobbying states to change laws that force auto companies to sell vehicles through franchised dealerships. Mr. Chen fought similar legislative battles during his tenure at Tesla and said the battle at Rivian has become more difficult.
Mr. Chen was also responsible for Rivian’s federal lobbying and regulatory affairs, leading a small team that traveled frequently to state buildings across the country and met with lawmakers on Capitol Hill.
The move comes at a critical time for the startup’s ties with Washington, which has thrown its support behind electric vehicles but has also introduced new restrictions that make it harder for some models to qualify for state tax credits.
R1T trucks are assembled at the Rivian facility in Normal, Illinois.
Photo: Brian Cassella/Zuma Press
Under the new rules, passed as part of last year’s Inflation Mitigation Act, only electric trucks and SUVs costing less than $80,000 will be eligible for federal tax credits, a change the Irvine, Calif.-based startup says it’s making disadvantaged.
While both Rivian’s R1T pickup and R1S SUV have starting prices under $80,000, the company has said most of its vehicles will sell for more than that amount as features and other options are added.
Rivian, which went public in November 2021 with a valuation of around $86 billion on its first day of trading, has grappled with a series of growing pains of late, including narrowly missing its production targets last year at its sole plant in Normal, Illinois.
The company’s stock price has fallen 76% since its sparkling debut, and its cash position has declined steadily to $13.8 billion through the end of September, the latest period for which information is available.
Rivian recently pushed back the launch of a cheaper model called the R2 by a year to 2026. Rivian chief executive RJ Scaringe said the delay was to give a planned Georgia plant ample time to prepare to start production.
The EV maker has also had some notable turnovers in its senior ranks, including replacing its head of production and chief operating officer within the last year. In July, Rivian announced plans to lay off 6% of its 14,000 employees, a cash-saving move aimed at responding to inflationary pressures and tight capital markets.
Mr. Chen has become a leading advocate of legislative changes to allow automakers to sell directly to consumers.
Rivian is under pressure to prove it can build its electric trucks at scale without first ramping up production as competition from legacy automakers mounts. WSJ toured the Rivian and Ford EV factories to see how they are striving to meet demand. Illustration: Adam Falk
Dressed in cowboy boots, the child of Taiwanese immigrants regularly visited state buildings across the country and fought some of the earliest legislative battles over direct vehicle sales while at Tesla. Mr. Chen said in an interview last summer that he left Tesla after nearly six years, having burned out from the pace of work.
Meanwhile, the battle between car manufacturers and car dealer associations over who gets to sell a vehicle has become increasingly fierce. At Tesla, Mr. Chen was able to make compromises that allowed this automaker to run captive businesses; He found that the merchants in Rivian were less willing to negotiate.
In Georgia, where Mr. Chen helped Tesla sell vehicles direct to consumers, he faced stiff opposition from state legislatures despite Rivian’s plan to build a $5 billion factory in the state.
EV startups could sell their vehicles through company-owned stores in Mississippi, but the proposed legislation would prohibit them from doing so except in narrow circumstances.
Rivian executives said opening more company-owned stores is an essential part of the retail strategy and necessary to reduce costs and increase deliveries to customers.
Write to Sean McLain at [email protected]
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