Tesla Culls Over 10% Of Its Global Workforce Amid Slowing Sales

This round of layoffs at Tesla could see upwards of 14,000 people being out of work from today. 

In what is perhaps an unfortunately all but expected move already after reporting its recent sales slump last quarter, Tesla has since recently announced that it will be brutal cut in its global workforce. 

The EV automaker is reportedly planning on eliminating “more than 10%” of its staff globally, according to an internal memo sent by company CEO Elon Musk on Sunday. This could therefore see at least 14,000 workers being culled from the company, as Tesla’s global workforce supposedly numbers somewhere on the order of 140,000. 

This brutal culling of its workforce comes amid Tesla deliveries in the first quarter having 20% from the previous quarter and more than 8% from the same time the previous year, marking the company’s first year-on-year sales decline since 2020. Among the factors contributing to this slump invariably includes the strengthening competition to its cars from the numerous Chinese competitors, in addition to its own slowness to refresh its aging models as high interest rates further sap consumer appetite for big-ticket items. 

There is thus far no official word yet on which region that Tesla operates in is hardest hit by this particular round of layoffs, but it nevertheless appears to go right across the company hierarchy. Such is as there have been (albeit unofficial) online posts regarding the door being shown to employees of every rank, from supposed high-ranking executives to warehouse employees.   

electric car factory

What more is that these layoffs are apparently effective immediately too, with those who were shocked by their sudden unemployment on Sunday claiming that taking to the internet commenting that they already been locked out of system access by Monday morning. 

Aside from these layoffs as well, there are to be whispers on the grapevine regarding reduced production at its Shanghai Gigafactory (where most of the right hand drive Teslas are made), with there being similar rumours going around too for a similarly shortened production shift being implemented in its Texas plant for its Cybertruck production line.  

Now it is worth highlighting that this is of course not the first layoff for Tesla, with this practice being more the norm rather than the exception for a silicon valley company. This is even not to be the largest round of mass sackings for the automaker too, who have culled roughly the same percentage of its workforce every two years or so. 

It has to be said however that this particular round of layoffs might have a stronger stench of corporate greed than usual, especially when considering that its CEO is currently in a very public dispute to secure his $56 billion (RM 266 billion) pay package. “There is nothing I hate more, but it must be done. This will enable us to be lean, innovative and hungry for the next growth cycle,” states Mr. Musk in the aforementioned internal memo regarding the mass layoffs. 

Given too though that Tesla has reportedly scrapped its affordable EV project, it does also beg the question as to what exactly does its next growth cycle entail. The eternal vapourware that is the rocket-boosted Roadster?

Joshua Chin

Automotive journalist. Professional work on and Personal writing found at Instagram: @driveeveryday

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