In Search of Profitability, Tesla to Cut Thousands of Jobs

In an email sent to Tesla Inc. staff yesterday, CEO Elon Musk said “we have made the difficult decision to let go of approximately 9 percent of our colleagues across the company.” This move was not unanticipated, according to Musk who said that these cuts were part of a previously decided simplifying of the management structure within the company. To this effect, he added, “These cuts were almost entirely made from our salaried population and no production associates were included, so this will not affect our ability to reach Model 3 production targets in the coming months.”

Tesla has been striving to meet its stated production target of five thousand Model 3 vehicles every week, and their inability to do so thus far has meant that the company has had to battle both cash flow issues, as well as lack of investor confidence. However, recent announcements and moves by the CEO and the company have seen investors, though still somewhat wary, looking more favourably at the company and its ability to deliver as promised in the long term. Share prices have been buoyed, seeing a rise of up to seven percent in recent weeks.

According to Musk who indicated that targets will be met by the end of this month, making moves to address other areas of the business of Tesla Inc., namely the sales of its solar products through established retail outlets, such as Home Depot. Musk has said that Tesla will not renew a residential sales agreement with Home Depot, preferring instead to share its line of solar products at its own physical and online stores, and that it would seek to re-employ as many Tesla employees as it could to staff its own sales locations.