Speaking at the recent Qatar Economic Forum, Tesla CEO Elon Musk announced layoffs were coming for Tesla employees. According to Reuters, he said that 10 percent of the company’s salaried workers would be handed walking papers. Musk says that equals approximately 3 to 3.5 percent of the automaker’s total workforce.
The announcement comes amid worries that the US economy could enter a recession. It also comes just two weeks after a leaked email from Musk to Tesla executives called for a 10 percent reduction in the automaker’s global workforce. The email also called for a halt to all new hiring. According to filings with the SEC, Tesla employed approximately 100,000 people at the end of 2021. Barring significant changes since then, a 3.5-percent reduction equals 3,500 jobs lost by the end of summer.
Motor1.com sent multiple messages to Tesla seeking comments and information regarding layoffs. No response has been received.
It seems some layoffs have already taken place, and it could be problematic for the automaker according to Reuters. Former Tesla employees have filed a lawsuit claiming the company violated federal law with mass layoffs that already took place in Nevada. The suit says 500 employees were laid off, and that Tesla didn’t provide 60-day advance notice as required under the Worker Adjustment and Retrain Notification (WARN) Act. Over 20 people were identified as former employees that were let go, and the suit is seeking class-action status.
As with the layoffs, Motor1.com contacted Tesla for a comment regarding the lawsuit but no response was received.
There’s no question that Tesla vehicles are in demand. The automaker surpassed 300,000 quarterly global sales last year thanks to strong showings from the Model 3 and Model Y. Recent sightings of Cybertruck prototypes at official events suggest Tesla’s overdue pickup truck is finally nearing the end of its development cycle.
Sources: Reuters, Bloomberg
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