“As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” Musk said in the memo obtained by CNBC.
“As part of this effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally,” the memo said.
Tesla had 140,473 employees as of December 2023.
There are two ways to look at this, and they are not mutually exclusive. One: the general economic trend is souring, which is why companies have announced significant layoffs since the start of the year -- especially those companies that produce higher-end or primarily luxury products. Two: The EV market is declining even with government mandates forcing consumers in that direction. It could well be both.
And for that matter, here's a third: China is pushing its own EV exports at losses in order to destroy US and Western competition. Musk alluded to that in November, as NBC notes. I suspect it's a combination of all three.
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