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Tesla To Cut 9% of its Workforce

Tesla boss Elon Musk informed employees via internal email that the company will be cutting jobs, according to a report by Automotive News website. The email specifies that 9% of the total workforce will be let go. However, none of the manufacturer’s production associates will be affected.

At the end of 2017, Tesla had a little over 37,000 workers on its payroll in all; several thousand have been added since then. This means that the round of cuts just announced will affect close to 4,000 salaried employees. It represents the largest cuts ever announced by the company in its existence.

As Elon Musk himself points out in his email, the company has never turned a profit since its founding nearly 15 years ago. And though this shows that company’s primary focus has not been the bottom line, the reality is that, at some point, Tesla has to show that it can become profitable.

This is clearly a reaction to the increasingly severe criticism being faced by the automaker in regards to the state of its financing and to its long-term viability.

We know that the Model 3, which was to have guided the company into the black, has been beset with production delays, causing significant losses.

“Given that Tesla has never made an annual profit in the almost 15 years since we have existed, profit is obviously not what motivates us. What drives us is our mission to accelerate the world’s transition to sustainable, clean energy, but we will never achieve that mission unless we eventually demonstrate that we can be sustainably profitable. That is a valid and fair criticism of Tesla’s history to date."

- Elon Musk

Photo: Tesla