Tesla Layoffs To Continue Through June, Morale Low Among Workers

Tesla Inc. TSLA employees are fearful as the rolling layoffs are expected to continue through at least June.

Over a month into CEO Elon Musk's plan to cut at least 10% of the workforce, the process is ongoing, causing employees to anxiously check their messages daily, uncertain of their job security. 

Former Tesla sales representative Michael Minick, who was laid off in April, shared his experience on LinkedIn, describing the constant fear and uncertainty among employees, reported Bloomberg.

"It's difficult to imagine the feeling of walking on eggshells every day at work," Minick wrote. 

The company's workforce has undergone significant changes, with a focus now on projects like artificial intelligence and robotics rather than solely on electric vehicles.

Current employees say Musk's emphasis on a robotaxi over a $25,000 electric vehicle has dampened morale, Bloomberg report notes. 

The company laid off 693 employees at its Nevada facilities with China facing escalating job cuts as it contends with pressure to regain market share in the world's largest auto market.

The latest job reduction last week involved 600 more jobs at Tesla's manufacturing facilities and engineering offices in Fremont and Palo Alto, California. 

The original mission that once inspired many has become unclear. The ongoing turmoil has contributed to a 29% decline in Tesla's share value this year, resulting in a $224 billion loss in market capitalization. 

Musk has not yet assured employees that the job cuts are finished, leading to an atmosphere of anxiety. One employee likened the situation to "Squid Game," the popular TV series where contestants face deadly challenges. 

Thousands of employees across various departments, including sales, human resources, and the Supercharger division, have already been affected. 

The company started the year with over 140,000 employees, but Musk aims for a 20% reduction in headcount.

The Supercharger division, crucial for Tesla's network of over 6,200 stations and 57,000 connectors worldwide, has seen significant layoffs. 

Some employees, including the director of charging for North America, Max de Zegher, discovered layoffs by seeing their Microsoft Teams icons turn gray. 

Although de Zegher was rehired, it's uncertain how many others will be brought back. 

The reduction in workforce has left gaps in maintaining and fixing Supercharger stations, particularly in Northern California and Canada, potentially leading to service disruptions.

As Tesla navigates these turbulent times, the broader EV industry faces sluggish demand, compounding the pressure on its workforce. 

This has prompted Tesla's largest layoffs to date as subdued consumer sentiment has dented sales.

Tesla stock has lost more than 7% in the last 12 months. Investors can gain exposure to the stock via ETFs, including Consumer Discretionary Select Sector SPDR Fund XLY and Fidelity MSCI Consumer Discretionary Index ETF FDIS.

Price Action: TSLA shares are trading lower by 2.05% at $173.83 at the last check Monday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Photo via Shutterstock