Tesla is reportedly laying off more than 10 percent of its workforce

Tesla has joined the litany of companies that have sweeping cuts last times. First informed by Electrek and since it is approved by Reuters the The Washington Post and New York Times, the company is laying off “more than 10 percent” of its workforce; As of December 2023, the company had more than 140,000 employees. The publication did not report the exact number of affected jobs, but saw an internal memo that noted the percentage. The source also informed about this Reuters some workers have already been notified, indicating that layoffs have already begun.

“As we prepare the company for the next phase of our growth, it is critical to look across the board to reduce costs and increase productivity,” Tesla CEO Elon Musk wrote in a memo. “As part of this effort, we conducted a comprehensive review of the organization and made the difficult decision to reduce our workforce by more than 10 percent globally.”

In early February, it was revealed that the company had asked managers which staff positions were essential and suggested layoffs were imminent. The automaker also eliminated two-year performance reviews for some employees Bloomberg.

Since 2020, Tesla has doubled its workforce and will end 2023 with more than 140,000 employees. Although a few have been implemented layoff periods over the years (including a dozen employees on the Autopilot team a year ago), the company’s workforce has grown by nearly 10 percent in 2023 alone.

During Tesla’s quarterly earnings call in January, CEO Elon Musk noted that the company is between “two big growth waves.” The first was the popularity of the Model 3 and Y. Next up is a cheaper EV that the company is pinning its hopes on. This is intended It will arrive at the end of 2025though Reuters suggest Tesla may abandon this low-cost model to focus on robotaxis. Electrek today supported Reuters’ report, said the low-cost model was effectively delayed as Tesla put its resources into robotaxis. The site also notes that “many people involved” in the low-cost car project have been laid off as part of the cuts. Musk says the company plans to introduce the robot on August 8.

Musk warned investors to expect “significantly low” sales growth this year, which could lead to cost-cutting to appease them. Indeed, Tesla a decrease in sales was observed In the first three months of 2024, shipments fell eight percent year-on-year and 20 percent quarter-on-quarter. The company is set to report earnings and sales for the first quarter of 2024 on April 23.

Update, April 15, 4:45 PM ET: This story has been amended to include additional details since publication Electrek About layoffs related to Tesla’s low-cost car project.

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