Why is Tesla laying off more than 10% of its global staff? Elon Musk notifies employees by email
Elon Musk’s Tesla has informed its staff that the company is laying off more than 10% of its workforce around the world. Why are they slashing jobs?
Electric vehicle (EV) company Tesla has announced to its staff that it is slashing more than 10% of jobs around the world.
According to Reuters, an internal memo indicated that the layoffs would be effective immediately.
Why is Tesla laying off more than 10% of its global staff?
The company has been hounded by plunging sales, with the announcement of the dismissals coming shortly after a disappointing delivery report for the first quarter.
The news also comes on the heels of an escalating price war involving EVs and a massive recall of nearly 2.2 million vehicles- almost all of the units it sold in the United States- over problems with their warning light.
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EV blog Elektrek reported that Tesla CEO Elon Musk delivered the news in a company-wide email.
“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,” Musk wrote.
“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. There is nothing I hate more, but it must be done,” he explained.
The billionaire said that the layoffs will enable the company to be “lean, innovative and hungry for the next growth phase cycle.”
Tesla bigwigs resign
Aside from the job cuts, two senior executives of the EV company- senior vice president Drew Baglino and vice president for public policy and business development Rohan Patel announced on X that they were leaving their posts.
Musk responded to their posts by thanking them for their service to the company.
Tesla has an international workforce of around 140,000 workers globally, so the job cuts will likely affect at least 14,000 employees. Tesla shares were down in midday trading, following the news of the layoffs.