Tesla to lay off 10% of staff globally as EV sales fall
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The news: Tesla will reduce its headcount by over 10% as demand for electric vehicles slows across the globe, hitting the world’s largest automaker.
The numbers: At the end of 2023, Tesla had over 140,000 employees globally, meaning the layoffs are likely to impact around 14,000 employees. The company reported its first year-on-year decline in quarterly deliveries since 2020 earlier this month. In a statement released by the EV maker, Tesla said it delivered 369,783 vehicles in the first three months of 2024, falling far short of analysts’ average estimate for 449,080 deliveries.
The context: CEO Elon Musk sent an email to Tesla employees on Monday announcing the news, according to a report by the Wall Street Journal, explaining the company’s need to reduce costs and increase productivity as reasons for the layoffs.
Musk said that Tesla had rapidly expanded and scaled up factories across the globe which lead to a duplication of roles and job functions.
“As part of the effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally,” Musk’s email reads. “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 phase cycle.”
Bloomberg reported that senior VP Drew Baglino, who has been at the company for over 18 years, will be leaving the company in the restructuring, as well as Tesla’s policy chair, Rohan Patel.
The source: Wall Street Journal
