Things keep on going from bad to worse for embattled electric car maker Tesla, which announced it is cutting more than 10% of its workforce, or about 14,000 jobs amid missed production deliveries and sagging sales.Mercurial chief executive Elon Musk made what he called a “difficult decision” in an internal memo distributed to the company’s 140,473 employees.The cuts will reportedly include senior executives as well as rank and file production workers.In the memo, Musk wrote that Tesla had grown rapidly in recent years and as a result there had been a duplication of roles and job functions.“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.”.The company has cited production problems caused by attacks on shipping in the Red Sea and an arson attack on its factory in Berlin, but analysts said the root cause is falling demand. The company has been slow to roll out new models such as the highly anticipated Cybertruck.Tesla reported first quarter sales of 387,000 units, down about 13% from the year before. It was the first drop in sales in more than four years. Tesla recorded gross profit margins of 17.6% in the fourth quarter, which was also its lowest in more than four years.The results fuelled criticism of Musk’s leadership style with one investment manager calling him a “toxic CEO.”On the weekend he was mugging for cameras alongside Bill Gates, Rupert Murdoch and Cybertruck owner Kim Kardashian at the Breakthrough Prize Ceremony, informally known as the Oscars of science in Hollywood, hours before making the biggest job cuts in the company’s history..Tesla’s shares have taken a hit, losing more than a third of their value since the start of the year.On Monday they lost almost 10% — or about $40 billion off its market capitalization of about half a trillion dollars — falling to USD$157.49.The carmaker has so-called ‘gigaplants’ in California, Nevada, New York and Texas as well as Germany and China.“About every five years, we need to reorganize and streamline the company for the next phase of growth,” Musk commented on Twitter (“X”) the social media platform he owns.
Things keep on going from bad to worse for embattled electric car maker Tesla, which announced it is cutting more than 10% of its workforce, or about 14,000 jobs amid missed production deliveries and sagging sales.Mercurial chief executive Elon Musk made what he called a “difficult decision” in an internal memo distributed to the company’s 140,473 employees.The cuts will reportedly include senior executives as well as rank and file production workers.In the memo, Musk wrote that Tesla had grown rapidly in recent years and as a result there had been a duplication of roles and job functions.“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.”.The company has cited production problems caused by attacks on shipping in the Red Sea and an arson attack on its factory in Berlin, but analysts said the root cause is falling demand. The company has been slow to roll out new models such as the highly anticipated Cybertruck.Tesla reported first quarter sales of 387,000 units, down about 13% from the year before. It was the first drop in sales in more than four years. Tesla recorded gross profit margins of 17.6% in the fourth quarter, which was also its lowest in more than four years.The results fuelled criticism of Musk’s leadership style with one investment manager calling him a “toxic CEO.”On the weekend he was mugging for cameras alongside Bill Gates, Rupert Murdoch and Cybertruck owner Kim Kardashian at the Breakthrough Prize Ceremony, informally known as the Oscars of science in Hollywood, hours before making the biggest job cuts in the company’s history..Tesla’s shares have taken a hit, losing more than a third of their value since the start of the year.On Monday they lost almost 10% — or about $40 billion off its market capitalization of about half a trillion dollars — falling to USD$157.49.The carmaker has so-called ‘gigaplants’ in California, Nevada, New York and Texas as well as Germany and China.“About every five years, we need to reorganize and streamline the company for the next phase of growth,” Musk commented on Twitter (“X”) the social media platform he owns.
