TESLA

Company will cut 10% of its workforce

Yesterday, in an email to employees, Tesla CEO Elon Musk warned of impending layoffs and a ban on hiring new workers worldwide. "I have a bad feeling about the economy," Musk told Reuters. The company will have to respond to the challenges of the economy and the dismissal of employees is the most effective and frequently used practice.

Tesla and its subsidiaries employed nearly 100,000 people at the end of 2021, according to data from the US Securities and Exchange Commission's annual report. Consequently, a reduction in the number of company employees by up to 10% will deprive up to 10 thousand people of their jobs. At the same time, as the Tesla boss emphasized, an immediate ban on hiring employees worldwide is being introduced.

Interestingly, Musk also released a statement to workers last Tuesday that remote work would be banned. All managers and office workers are required to return to their offices and spend at least 40 hours a week there. This requirement generated dissatisfaction among the company's employees and criticism from recruiters. Musk was accused of being backward and incapable of a flexible working model at the company. However, other experts saw this as a hidden opportunity for the automatic dismissal of the disaffected.

The announcement of the upcoming layoffs reduced the company's shares in the US and Europe: by 3% in the US before the start of trading and by 3.6% on the Frankfurt Stock Exchange. Not only is Elon Musk talking about a possible recession in the economy, but the order to reduce the number of employees is no longer spoken. This is an attempt to stop the impending problems.

Image source: REUTERS/Michele Tantussi