- By Siona McCollum
- Technical Reporter
image source, Good pictures
Tesla will lay off more than 10% of its global electric vehicle workforce
In a memo first reported by the news website Electrek, billionaire owner Elon Musk told employees he had nothing to hate, but had to.
The world’s largest automaker by market value had 140,473 employees worldwide as of December, according to its latest annual report.
Tesla did not respond to the BBC’s request for comment.
“We have conducted a complete review of the company and have made the difficult decision to reduce our workforce by more than 10% globally,” Musk’s email said.
“I have nothing to hate, but it has to be done. It helps us stay lean, innovative and excited for the next cycle of growth.”
A Tesla employee who was fired told the BBC that his emails, like those of all other fired employees, were blocked.
Andrew “Drew” Paglino, one of the management team, said in a post on X (formerly Twitter) on Monday that he had made the “difficult decision” to leave the company after 18 years.
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Another public policy and business development executive, Rohan Patel, is also expected to go.
He personally thanked Musk for giving him the opportunity to lead important initiatives at the company.
He added that the “never-say-die attitude and tenacity” of Tesla’s broader team made it a special place to work.
Michael Ashley Shulman, chief investment officer at Running Point Capital Advisors, said Tesla’s departure from a key growth phase is a “bigger negative sign today” than the job cut announcement.
However, analysts at Gartner and Hargreaves Lansdowne said the cuts are a sign of cost pressures as automakers invest in new models and artificial intelligence.
Electric vehicle (EV) manufacturers have been slow to update their aging models as high interest rates have dampened consumer appetite for high-value products.
The company is expected to announce its quarterly earnings later this month, but it has already reported a drop in vehicle deliveries in the first quarter, the first in nearly four years and below market expectations. Some analysts described the results as “unsettling”.
Last month, Tesla cut production at its Gigafactory in Shanghai, and last week Tesla told employees working on the Cybertruck that changes to the production line in Austin would be minimal.
Tesla is beginning to feel the effects of declining demand for electric vehicles (EVs).
Elon Musk recently denied reports that the company has abandoned plans to make cheap cars, his longtime goal of making EVs affordable for the masses.
Shares of Tesla fell 0.8% in premarket trading on Monday.
