Elon Musk's Tesla Laying Off Employees At Shanghai Battery Plant Amidst Price War: Report

In a recent development, Tesla Inc. TSLA has begun laying off some of its battery production workers at its Shanghai plant, Bloomberg reports.

Reasons Behind the Layoffs

The layoffs come amidst a fierce price war in China, leading to heavy discounts on cars across manufacturers. The exact number of workers to be let go and the specific reasons behind the layoffs remain unclear. Some employees have been offered the option to transfer to other workshops such as stamping, painting, or general assembly.

Automation and Future Plans

Automation equipment that could potentially replace human labor on the battery production line is currently in the design and construction phase. Despite the layoffs, Tesla’s deliveries from Shanghai rose almost 20% year-on-year earlier in June to 93,680 vehicles, indicating a possible recovery from the price war disarray.

See Also: Tesla Sued By Former Employees For Violating Advance Layoff Notice

CEO’s Stance

CEO Elon Musk has expressed comfort with making less money on each car sold, following several rounds of price cuts. Earlier this week, Tesla, along with other automakers in China, pledged to maintain fair competition and avoid “abnormal pricing” in the world’s biggest EV market.

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