Tesla reportedly laying off more than 10% of workforce
A leading manufacturer and retailer of electric vehicles (EVs) will reportedly trim headcount.
According to CNBC, an internal memo to Tesla employees from CEO Elon Musk, one of the world’s wealthiest people with an estimated net worth of over $190 billion, said the EV company is laying of more than 10% of its staff.
"Over the years, we have grown rapidly with multiple factories scaling around the globe," Musk said in the memo as transcribed by CNBC. "With this rapid growth there has been duplication of roles and job functions in certain areas. As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity.
“As part of this effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally," Musk said in the transcribed memo. "There is nothing I hate more, but it must be done. This will enable us to be lean, innovative and hungry for the next growth phase cycle… We are developing some of the most revolutionary technologies in auto, energy and artificial intelligence."
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As of December 2023, Tesla had 140,473 employees. The company is facing stiff competition from Chinese competitors manufacturing less expensive EVs, and recently reported a year-over-year decline in vehicle deliveries for the first quarter of 2024, its first reduction in annual demand since the COVID-19 pandemic disrupted the global auto industry in 2020.
Tesla stock value has also been falling, with a 31% year-over-year decline so far in 2024 according to CNBC. Some observers have also said that controversial comments Musk has made on X, the social network formerly known as Twitter he purchased for $44 billion in October 2022, have had a negative impact on both Tesla and X revenues.
Read more CNBC coverage here.