Tesla plans to lay off more than 10% of its global workforce.
New York:
Tesla plans to cut more than 10% of its global workforce, news website Electrek reported on Monday, publishing an email from CEO Elon Musk announcing the layoffs.
According to Electrek, an online news site focused on electric vehicles (EVs), Musk said in an email to employees that the layoffs were needed after rapid growth led to duplication of positions.
“There’s nothing I hate more than this, but it has to be done,” Musk said. “This will allow us to be lean, innovative and hungry for the next growth stage cycle.”
About ten days ago, Tesla reported a drop in first-quarter vehicle deliveries in a report that disappointed investors.
Musk’s company has also made a series of price cuts for electric vehicles in response to growing competition among manufacturers and slowing demand growth in some markets.
Wedbush analysts said that while Tesla was aggressively cutting costs amid a “disastrous” first-quarter delivery volume and overall pressure on the business, “this is a good time for a company in between two growth waves.” A massive cost-cutting initiative.”
“The string of bad news over the past few months has been a horror show for investors,” they added, stressing the need for explanations for cost cuts and other issues.
But White House press secretary Karine Jean-Pierre told reporters that electric vehicle sales have surged in recent years and are “more affordable than ever.”
While she could not comment on Tesla’s decision, she said President Joe Biden’s administration has been making manufacturing efforts to increase electric vehicle production and reduce costs.
Tesla began delivering the Cybertruck, a space-age-inspired vehicle, late last year, which Musk praised while warning that ramping up production would take some time to become profitable.
Tesla shares closed down 5.6% on Monday.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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