Tesla to Lay Off Over 6,000 Employees, Reducing Global Workforce by 10%
Tesla Inc. is bracing for significant job cuts, affecting over 6,000 employees across its operations in Texas and California, in line with CEO Elon Musk’s directive to slash the global workforce by more than 10%.
According to a report by Bloomberg, the cuts will heavily impact 2,688 workers in Austin, the city where Tesla’s headquarters and a major factory are located.
These reductions, outlined in a WARN notice filed with the Texas Workforce Commission, are scheduled to commence over a 14-day period starting June 14.
Simultaneously, Tesla intends to lay off 3,332 employees across various locations in California, as indicated by separate WARN notices filed in the state.
Before these layoffs, Tesla boasted a workforce of over 140,000 globally.
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However, insiders familiar with the situation suggest that the actual number of affected individuals may exceed 20,000, given the company’s recent announcement of layoffs exceeding 10%.
At the end of last year, Tesla employed over 22,000 individuals in Austin alone. The production facility in Austin primarily focuses on manufacturing the Model Y and Cybertruck, although the specific breakdown of impacted roles, including factory positions, remains unclear.
Despite the announcement of workforce reductions, Tesla’s shares witnessed a 2% increase in New York trading at 3:18 p.m.
However, the stock’s performance throughout the year has been less favorable, with a 42% decline, marking it as the worst-performing stock in the S&P 500 Index.
The decision to cut jobs comes amidst a broader context of transformation and challenges within Tesla.
As the company navigates its shift towards Elon Musk’s vision of a robotaxi future, internal reorganization and strategic realignment are underway, reflecting Tesla’s ongoing evolution in the automotive industry landscape.
