Tesla has downsized at least 14% this year, internal figures show

X Chief Technology Officer Elon Musk speaks on stage during the session “Exploring new frontiers of innovation: Mark Read in conversation with Elon Musk” at the Lumiere Theater during the 2024 Cannes Lions International Festival of Creativity – Day three on June 19, 2024 in Cannes, France.

Richard Bord | Wire images | beautiful images

by Tesla Internal records show that drastic downsizing in 2023 has reduced the global headcount to just over 121,000 people, including temporary workers, suggesting that the automaker has cut back more than 14% of its workforce this year.

The latest number comes not from exact payroll data but from the number of people on Tesla’s “everyone” email distribution list as of June 17, a figure seen by CNBC.

Tesla CEO Elon Musk emailed “everyone” that day. “Over the next few weeks, Tesla will conduct a comprehensive review to provide stock option grants for superior performance,” he told employees. He added that option grants will also be given to “anyone who does something outstanding for the company”. Tesla’s plan to reinstate option grants, after previously suspending performance-based equity awards, was first reported by Reuters.

Tesla’s layoff announcement came in April, when Musk sent out a company-wide email told employees that the automaker would cut more than 10% of its staff. The layoffs at that time were already underway.

Bloomberg reported that Musk is aiming to cut staff by 20%. Musk pointed out that the number could be even larger. During the company’s first-quarter earnings call in late April, he said Tesla had hit a 25% to 30% underperformance after “a long period of prosperity” that began in 2019.

“We made some adjustments along the way,” Musk said on the call. “But the time has come to realign the company for its next phase of growth.”

in one submit In the fourth quarter, Tesla said its worldwide employee count at the end of December was 140,473, a number that represents the number of salaried and hourly employees. The “everyone” email list includes temporary workers. At about 121,000, that suggests Tesla has reduced its total headcount by at least 14% since the end of 2023.

Tesla did not immediately respond to a request for comment.

In at least one case, Musk’s headcount cuts went too far. Tesla has disbanded its Supercharge team, includes hundreds of employees, including its leader, Rebecca Tinucci. The company later rehired some of those people, according to the LinkedIn post.

The wider cuts coincide with a sales decline at Tesla as the company reckons with its aging electric vehicle lineup and growing competition in China as well as brand decline. Recent surveys partly attributed to Musk’s “antics” and “political rants.” In the first quarter, Tesla reported Annual revenue fell 9%, the largest decline since 2012.

Across the auto industry, electric vehicle sales growth has slowed this year after two years of rapid growth. The slide has been especially severe for Tesla, whose Model Y is the best-selling car globally in 2023.

A Tesla employee, who requested anonymity to discuss sensitive internal matters, told CNBC that some factory workers fear more layoffs in July, depending on the outcome. second quarter.

Tesla is expected to report Q2 production and deliveries in the first week of July.

Musk has promised investors that the company will soon announce a new “Master Plan,” which will be his fourth, and that Tesla will reveal its design for a “dedicated robotaxi.” on August 8.

Tesla shares were little changed on Friday at $181.71. The stock is down 27% this year, while the Nasdaq is up 18%.

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