Tesla to Cut 10% of Salaried Staff, Musk Tells Employees

Elon Musk, Tesla’s chief executive, plans to cut the electric car maker’s paid workforce by 10 percent, he told staff in an email Friday.

The job cuts will not apply to employees who make cars or batteries or who install solar panels, and will increase the number of employees per hour, Mr. Musk said in an email that a copy of which was reviewed by The New York Times. “Tesla will reduce payroll head counts by 10 percent, as we become more staffed in many areas,” he said.

Reuters had earlier quoted a separate email as saying that Mr. Musk was only sent to Tesla officials. The automaker’s share price closed down nearly 9 percent on Friday after that article was published.

Tesla’s staff has grown significantly as sales have increased and it has built new factories, including two factories opened this year near Berlin and Austin, Texas. The company employed more than 99,000 workers at the end of last year. Just two years ago, Tesla had 48,000.

Mr. Musk and Tesla did not respond to requests for comment.

Earlier this week, Mr. Musk told employees at his rocket company Tesla and SpaceX that he expects to spend at least 40 hours a week in his office.

Mr. Musk told SpaceX employees in an email on Tuesday. “That’s why I spent so much time in the factory – so that those in line could see me working with them. If I hadn’t done that, SpaceX would have gone bankrupt a long time ago. “

That announcement Mr. Musk and his companies are in a heated debate over the right approach to restore normalcy after two chaotic years of the epidemic. It also invites concern that it may eliminate top artists who would prefer to work from a distance some or all of the time.

The new layout will not be the first in Tesla. The automaker also fired some workers in 2017 and 2018.

In recent weeks, investors have begun to question the company’s skyrocketing share price. The market value of the company is more than $ 728 billion, more than any other large automaker. Shares of Tesla fell nearly 40 percent from their highs at the end of last year, drawing attention to the company’s growing competition, allegations of racial discrimination and the risks of production problems at its factory in Shanghai.

Some critics say Mr. Musk’s bid to buy Twitter is yet another setback that could hurt Tesla. A major concern for some investors is that the automaker’s board lacks sufficient independence from the chief executive to monitor it and its impulses.

“From a corporate good-governance perspective, Tesla has a lot of red flags,” Andrew Poreda, a senior analyst who specializes in socially responsible investments in Sage Advisory Services, an Austin-based investment firm, told The Times last month. “There are almost no checks and balances.”

Mr. Musk’s management style and success – he is listed by Bloomberg and Forbes as the richest man in the world – has earned him fans but turned him into a powerhouse. Tesla has lost a number of top executives in recent years, many of whom have gone on to top jobs in other automakers, tech companies and battery manufacturers.

Recently, Mr. Musk praised work ethic in China, where labor conditions can be harsh or even abusive, suggesting that workers in the United States were lazy. “They will not just burn the oil at midnight. They will burn oil at 3 in the morning, “he said in an interview with the Financial Times about Chinese workers.” So they will not give up the factory type thing.

Still, some analysts remain bullish on Tesla’s prospects. “In our view, Tesla does not need to hire more staff to sustain its growth, and we think the plan to reduce the workforce may indicate that Tesla hired more last year,” Seth Goldstein, senior equity analyst at Morningstar, said in a note on Friday. .

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