Tesla has joined the litany of corporations which have performed sweeping layoffs in current occasions. First reported by Electrek and since corroborated by Reuters the Washington Publish and the New York Occasions, the corporate is firing “greater than 10 p.c” of its workforce; the corporate had greater than 140,000 staff as of December 2023. The publication noticed an inner memo noting the share, although it did not state the precise variety of jobs affected. A supply additionally advised Reuters that some staffers have already been notified, which signifies that the layoffs have already begun.
“As we put together the corporate for our subsequent part of progress, this can be very vital to take a look at each facet of the corporate for price reductions and growing productiveness,” Tesla CEO Elon Musk reportedly wrote within the memo. “As a part of this effort, we have now accomplished an intensive assessment of the group and made the tough resolution to scale back our headcount by greater than 10 p.c globally.”
It emerged in early February that the corporate requested managers which staff’ positions have been important, suggesting that layoffs have been imminent. The automaker additionally canceled biannual efficiency opinions for some employees, in line with Bloomberg.
Since 2020, Tesla has successfully doubled its headcount and ended 2023 with greater than 140,000 staff. Though it has carried out a number of rounds of layoffs over time (together with dozens of employees on the Autopilot staff a yr in the past), the corporate’s workforce grew by about 10 p.c in 2023 alone.
Throughout Tesla’s quarterly earnings name in January, CEO Elon Musk famous that the corporate was between “two main progress waves.” The primary was the recognition of the Mannequin 3 and Y. The following is a lower-cost EV that the corporate appears to be pinning its hopes on. That is slated to reach in late 2025, although Reuters suggests Tesla could also be ditching that lower-cost mannequin to give attention to robotaxis. Electrek backed up Reuters’ reporting at this time, saying that the low-cost mannequin was successfully postponed as Tesla is placing its assets into robotaxis as an alternative. The positioning additionally notes that “many individuals concerned” within the low-cost automotive venture was laid off as a part of the layoffs. Musk says that the corporate plans to disclose its robotaxi on August 8.
Musk had warned traders to anticipate “notably decrease” gross sales progress this yr, which can have prompted cost-cutting efforts to appease them. Certainly, Tesla noticed a gross sales droop within the first three months of 2024. Deliveries dropped by eight p.c year-over-year and 20 p.c from the earlier quarter. The corporate is ready to report earnings and gross sales for the primary quarter of 2024 on April 23.
Replace, April 15, 4:45PM ET: This story was modified after publish to incorporate additional particulars from Electrek concerning the layoffs in relation to Tesla’s low-cost automotive venture.
