Tesla, the electric car manufacturer, is reducing its global workforce by more than 10%, which is approximately 14,000 jobs, in response to decreased demand and pricing pressures. CEO Elon Musk made this announcement in a memo that was initially reported by Elektrek. Tesla currently employs 140,473 individuals, as stated in its annual report.
Musk explained that Tesla’s rapid growth led to duplicated roles and responsibilities, necessitating these layoffs. He noted, “There’s nothing we hate more, but it has to be done. This allows us to be lean, innovative, and greedy for the next cycle of growth.”
This decision comes after a challenging start to the year for electric car companies, with Tesla reporting lower-than-expected car deliveries in the first quarter of 2024. The company attributed this decline to production challenges and a slowdown in global demand.
According to critics, including Ross Gerber from Gerber Kawasaki, Tesla’s sales dip in a growing economy highlights concerns about lack of advertising, competition, and leadership. The company aims to boost profit margins amidst price cuts and increased competition.
The layoffs reflect the broader trend of slowing growth in the electric vehicle market, impacting Tesla’s performance. Tesla’s stock has seen a decline in value, losing around a third of its market capitalization this year.
Additionally, Reuters reported that BP is scaling back its electric vehicle charging business, reducing its workforce by more than 10% to focus on commercial electric vehicles. The company cited a need for greater precision and effectiveness in achieving its goals.
Tesla has facilities across the US, Germany, and China. The company has not yet responded to requests for comment.
Source: www.theguardian.com
