Tesla Employees Worried About Massive Layoffs: Reports

Reports from both Business Insider and Electrek indicate that Tesla Inc employees are apprehensive about potential layoffs as the electric vehicle manufacturer grapples with declining sales.

Rumors circulating within Tesla's offices, particularly at the Texas Gigafactory, suggest that the company might announce layoffs as early as this week. Concerns about job cuts are also prevalent among workers at the Fremont factory.

According to Electrek, the layoffs could affect up to 20 per cent of Tesla's workforce, while Business Insider noted that production shifts for the Cybertruck have already been shortened.

These reports come as Tesla, the world's most valuable automaker, experienced a significant drop in first-quarter deliveries due to weakening demand and intensified competition in China, a key market.

Global demand for electric vehicles has eased as consumers scale back major purchases amidst deteriorating economic conditions. Additionally, a resurgence in the popularity of hybrid models has contributed to the decline in EV demand.

Earlier this year, Tesla instructed managers to identify essential roles within the company and reportedly delayed some performance reviews.

Despite reducing vehicle prices, particularly in China, over the past year to stimulate demand, Tesla's sales received only a limited boost. The company has adjusted its production targets for 2024 and reportedly scrapped plans for a low-cost EV in response to softer demand.

However, Tesla remains focused on expanding its presence in self-driving and artificial intelligence technology to counteract declining sales. CEO Elon Musk recently announced plans to unveil the company's first robotaxi in August.

Musk has attributed the sales downturn to high interest rates and a weakened global economy.