Yahoo Finance Tesla eyes major job cuts according to industry news site
Elon Musk’s Tesla is bracing for a major round of layoffs after an industry website reported looming cuts, citing an email to staff from the state-of-the art electric car firm’s billionaire founder and chief executive.
Electrek reported that more than 10% of Tesla’s global workforce could go, after the firm has been preparing for a reduction in headcount for months. The news site said that the cuts could even reach a fifth of Tesla’s staff. Electrek quoted the email as saying:
“We have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally. 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.”
The email follows a difficult run for Tesla, which has grappled with a fire at its European factory, disruption to global shipping lines and lower production. The problems culminated in an 8% drop in deliveries of under 387,000 vehicles in the first quarter, significantly short of expectations.
Rising interest rates around the world have pressured consumers’ budgets and increased finance costs, with big-ticket items such as electric cars looking especially exposed. Tesla cut prices, eating into margins and adding to pressure on its shares.
It was the first quarterly fall in deliveries on a year-on-year basis since 2020. The drop from the final quarter of 2023 was 20%. Its shares are down by around 30% this year.
Tesla has around 140,000 employees. It laid off around 10% of its staff in 2022. Its Model 3 car has a recommended retail price in the UK of £39,990 to £49,990
