CEO Elon Musk said in a memo that the layoffs will leave the company “lean, innovative and hungry for the next phase of its growth cycle.”
Electric car maker Tesla plans to lay off more than 10% of its global workforce, according to a memo sent to employees by CEO Elon Musk.
Musk told employees in an email on Monday that the job cuts are necessary due to “overlapping roles and duties in certain areas” as the company rapidly expands around the world.
“As we prepare the company for its next phase of growth, it is extremely important for us to look at all aspects of the company to reduce costs and increase productivity,” Musk said in a memo obtained by multiple media outlets. It’s important.”
“As part of this commitment, we have overhauled our organization and made the difficult decision to reduce our workforce by more than 10 percent globally. We could not be worse off, but we must do it. This allows us to be lean, innovative and greedy for the next cycle of growth.”
Musk thanked the remaining staff for the “continuing difficult work” as the company works to develop “game-changing technologies in automotive, energy and artificial intelligence.”
In a post on X after the news became public, Musk said Tesla needs to “realign and streamline the company for the next phase of growth” approximately every five years.
The layoffs were first reported by Electrek, a media outlet focused on electric transportation and sustainable energy.
The announcement comes less than two weeks after Tesla reported an 8.5% drop in first-quarter vehicle deliveries, the first year-over-year decline since 2020.
Tesla's disappointing performance followed supply chain disruptions caused by Houthi attacks on ships in the Red Sea and arson attacks by environmental activists at production facilities in Germany.
In a sign of further turmoil at the company, two senior executives announced their departures on social media.
Andrew Baglino, senior vice president of powertrain and energy engineering, told X that the company had made the “difficult decision to exit Tesla for the first time in 18 years.”
“I'm so grateful to have worked with and learned from so many talented people at Tesla over the years,” Baglino said.
Rohan Patel, senior global director of public policy and business development, also said he was leaving after eight years with the company.
Tesla shares fell more than 5% on Monday, continuing a downward trend that has seen the stock lose about a third of its value so far this year.