Tesla is going to announce the layoff of 10% of its workforce in the coming days. Elon Musk has not denied it.
It is the consequence of the poor results of recent months, and of some personal decisions by Elon Musk (yes, Cybertruck, we point out to you), which are going to be very expensive for the company. Not to mention that the Chinese industry has already overtaken the Chinese company to the right. Elon Musk.
With a line of vehicles that is already a few years old, Tesla faces a complicated futurewhile Elon Musk sets his sights on a business different from mainstream vehicles: robotaxis.
Tesla lays off 14,000 workers
According to inform Reutersin a memo addressed to its employees to which the media has had access, Elon Musk announces the layoff of 10% of the Tesla workforce:
“As we prepare the company for our next phase of growth, it is extremely important to examine all aspects of the company to reduce costs and increase productivity,” Musk says in the statement to workers.
“As part of this effort, we have conducted a comprehensive review of the organization and have made the difficult decision to reduce our workforce by more than 10% globally.”
Among the layoffs are two important executives: Head of battery development Drew Baglino and vice president of public policy Rohan Patel.
These layoffs are a consequence of the poor results of Elon Musk's company in the last quarterwhere, for the first time in four years, the number of cars sold decreased compared to the same period of the previous year.
So what Tesla has lowered the price of its vehicles in 2023which has also reduced the profit margin.
Now tesla faces numerous problems, which are not easy to solve. Their line of vehicles is already a few years old, and although they are perfectly valid, users are looking for something new.
In recent years its only novelty has been the Cybertruck, a niche vehicle whose mass production is a pain, because it does not use conventional parts. To make matters worse, The cheap Tesla Model 2 that was going to bring the electric car to the masses has reportedly been canceled:
Now Musk has set his sights on a new market, even more full of uncertainties: the robotaxis. A business dotted with deep mines in the form of lack of regulation, strict regulations, and the reliability problems of the Tesla autopilot. It does not seem like a market to make money in the short or medium term, quite the opposite.
But the most worrying thing for Tesla, and for the entire Western electric car industry, is the spectacular advance of Chinese electric cars.
The Chinese industry is the only one that has understood that what the markets, and the planet, need, are not cybertrucks, nor luxury electric vehicles twice as expensive as fuel vehicles. What is needed now are reliable and cheap electric carsand that's exactly what they're building… and successfully selling.
For the first time, a Chinese car company, BYD, has sold more electric cars than Tesla in 2023. And by a wide margin: 3.02 million, compared to 1.81 million for the brand. Elon Musk.
Tesla is going to lay off 14,000 workers in the coming days. These are bad times for the company, and there are no short-term solutions in sight.
