Elon Musk to now fire Tesla employees? Company checking which job roles are important

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Tesla’s CEO, Elon Musk, might be planning job cuts at the company. Following Musk’s previous actions of firing thousands of Twitter employees post its acquisition for reasons that many don’t agree with, it might not be surprising for people to see similar things happening with other companies that he is running. A report from Bloomberg claims that Tesla is evaluating which job roles are essential for the company’s operations and the cited source also hints at potential layoffs. Here are the details.

According to sources familiar with the matter, Tesla managers in the United States have been asked to determine the criticality of each employee’s position. This assessment comes after the cancellation of some employees’ biannual performance reviews. Elon Musk’s focus on cost-cutting amidst a slowdown in Tesla’s sales growth appears to be driving this initiative. Musk, known for his uncompromising approach, previously issued ultimatums to Twitter staff, emphasizing adherence to his “hardcore” ethos.

It is worth mentioning that Tesla’s shares rose before the start of regular trading on Wednesday, indicating investor’s confidence despite the uncertainty surrounding potential job cuts. Tesla’s workforce has reportedly expanded significantly in recent years, reaching over 140,000 employees globally by the end of last year, a doubling since 2020.

Despite this growth, Tesla has made selective cutbacks in certain areas. Last February, it was reported that the company sacked dozens of employees in Buffalo, New York, amidst controversy over their involvement in labeling data for the Autopilot driver-assistance system. Although, Tesla denied allegations that the terminations were linked to a union campaign announced that same week.

During Tesla’s recent quarterly earnings call, Musk highlighted the company’s transition between growth waves, driven initially by the introduction of the Model 3 and Model Y, and anticipated future growth from a lower-cost vehicle slated for release late next year. Tesla has reportedly allocated substantial funds toward the development of next-generation electric vehicles and other growth initiatives, with capital expenditures exceeding $10 billion this year.

Additionally, the cited source reported that Tesla has plans to increase spending on research and development. There are chances that this might be the reason by the company is now looking to cut cost, which is not officially confirmed and so, users are advised to take the details with a pinch of salt. Though, the company’s Chief Financial Officer, Vaibhav Taneja, just recently emphasized the importance of cost optimization efforts during Tesla’s recent earnings call. It now remains to be seen whether Tesla will be taking some cost cutting measures or not and whether this will impact the company’s employees.

Published By:

Ankita Garg

Published On:

Feb 7, 2024

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