Tesla’s workforce reductions have now extended into a fourth week, leaving many employees anxious and uncertain about their job security. The latest wave of layoffs is impacting various departments, including software, services, and engineering.
Notifications have been trickling in over the weekend and into Monday, with the exact number of affected employees still unclear. However, reports indicate that at least seven employees received layoff notices on Sunday alone. This constant stream of terminations has reportedly created a tense and anxious environment within the company, prompting many employees to actively seek new opportunities outside Tesla.
The layoffs, first announced last month, aim to reduce Tesla’s global workforce by 10%, out of a total of 140,000 employees. CEO Elon Musk justified the cuts by pointing to “duplication of roles and job functions” within the company.
Musk reportedly communicated to executives the need for an “absolutely hard core” approach to headcount reduction. This directive has led to the departure of several executives, including Tesla’s head of EV charging and the head of the new vehicles program.
Some reports suggest that Musk initially considered a more dramatic workforce reduction of 20%, potentially reflecting a strategic shift towards increased automation. This aligns with his recent focus on Tesla’s autonomous vehicle ambitions, including promises to unveil a self-driving robotaxi later this year.
These layoffs coincide with a challenging financial period for Tesla. Sales figures have dipped, and profits have reportedly fallen by 55% year-over-year. The company faces increased competition in both the US and Chinese markets, along with a potential global decline in electric vehicle demand.
Tesla’s workforce reduction strategy appears to be a response to these financial pressures. However, the ongoing nature of the layoffs and the lack of clarity surrounding job security are significantly impacting employee morale.
