- Elon Musk reportedly desired a one-fifth workforce reduction at Tesla, according to Bloomberg.
- Musk desired that the reduction in quarterly vehicle deliveries coincide with the cutbacks.
•In the first quarter of 2024, Tesla delivered 386,810 vehicles, a 20.1% decrease from the previous quarter.
Tesla CEO Elon Musk reportedly desired a 20% personnel reduction at one point, according to information cited by Bloomberg on Sunday from a source with knowledge of the situation.
Musk reasoned that the reduction should be equivalent to the decline in vehicle deliveries as reported by Bloomberg from the fourth quarter of 2023 to the first quarter of 2024.
Tesla reported earlier this month that it shipped 386,810 vehicles in the first quarter of 2024, a decrease of 20.1% compared to the previous quarter. Since 2022, the delivery decline represented the organization’s worst quarterly performance.
Musk had last week disclosed a round of widespread reductions at Tesla. According to a memo to employees, the billionaire announced that the organization is reducing its workforce by “over 10%.”
“Over the years, we have grown rapidly with multiple factories scaling around the globe,” Musk asserted. “With this rapid growth, there has been duplication of roles and job functions in certain areas.”
Prior to the announcement of redundancies, Tesla reported that it had a global workforce exceeding 140,000 individuals.
In addition to experiencing a decrease in sales, the organization has encountered heightened competition from Chinese automotive manufacturers such as BYD. During an earnings call with investors in January, Musk stated that Chinese manufacturers “are the most competitive automakers in the world.”
The increasing challenges faced by Tesla have prompted inquiries into Musk’s capacity to concurrently manage numerous enterprises. Musk is also the leader of several other ventures, including SpaceX, The Boring Company, Neuralink, X, and xAI, in addition to Tesla.
However, Musk has maintained, as stated in a memo to staff last week, that the cutbacks were essential to keep Tesla “lean, innovative, and hungry for the next growth phase cycle.”
“There is nothing I hate more, but it must be done,” he concluded.
BI received no immediate response from Tesla representatives in response to a request for comment sent outside of normal business hours.
