Last week, Tesla confirmed analysts’ predictions that the company would lay off workers. However, Bloomberg News reports that Musk wanted to fire even more. Musk announced on April 15 that “more than 10%” of Tesla’s 140,000-worker global headcount would be laid off, citing “duplication of roles and job functions in certain areas.” This resulted in at least 14,000 job losses. “There is nothing I hate more, but it must be done,” the Tesla CEO wrote to staff. “This will enable us to be lean, innovative and hungry for the next growth phase cycle.”
However, Bloomberg reports that the layoffs may have affected more people than initially believed. People familiar with the company’s planning told the publication. And a person with direct knowledge of Musk’s discussions told Bloomberg that he had wanted to slash Tesla’s workforce by 20%. That percentage, Musk reasoned, would match between the fourth quarter of 2023 and the first quarter of 2024.
Tesla announced earlier this month that it delivered over 310,000 vehicles in the first three months of 2024, down from between October and December. Tesla’s lowest quarterly performance since 2022 was the drop. Last quarter also marked Tesla’s first year-over-year decline since the second quarter of 2020.
“The sweeping layoffs announced yesterday, amounting to a reduction in crewed production capacity, should now leave no doubt that the decline in deliveries has been a function of lower demand and not supply,” JPMorgan analysts wrote last week.
Over the weekend, Tesla implemented price cuts in China, Japan, Germany, and the U.S. to address slowing sales and increased competition in China. The cuts primarily affect the Model 3 and Model Y, which make up the bulk of the company’s deliveries.
Tesla stock dropped more than 3% in trading Monday to almost $142 per share. The stock sank as low as $138.80, marking the company’s latest 52-week low.
