In California, Tesla has recently announced 600 job cuts as part of its ongoing layoffs.

In California, Tesla has recently announced 600 job cuts as part of its ongoing layoffs.
In California, Tesla has recently announced 600 job cuts as part of its ongoing layoffs.
  • This week, Tesla announced that it will be laying off approximately 600 employees from its manufacturing facilities and engineering offices in Fremont and Palo Alto, California.
  • In a memo in April, Elon Musk, the CEO, informed employees that the company would reduce its global workforce by more than 10%, though no specific number has been provided.
  • A 30% stock price decline this year has led to a restructuring at Tesla, following a drop in first-quarter sales.

The electric vehicle manufacturer announced this week that it will be laying off approximately 600 employees at its manufacturing facilities and engineering offices in Fremont and Palo Alto as part of a major restructuring.

The recent layoffs affected various positions, from entry-level to directorial, and impacted multiple departments, including factory workers, software developers, and robotics engineers.

A public records request obtained by CNBC revealed the cuts in a Worker Adjustment and Retraining Notification (WARN) Act filing.

Since January, Tesla has been reducing its staff due to declining demand for EVs and intensified competition. In April, CEO Elon Musk announced that the company would eliminate more than 10% of its global workforce, which had grown to 140,473 employees at the end of 2023.

Over 6,300 job cuts were disclosed in previous filings at Tesla's locations in California, Austin, Texas, and Buffalo, New York.

Tesla's quarterly earnings call last month revealed that the company had accumulated a 25% to 30% "inefficiency" over the past few years, which could result in layoffs affecting more than 10,000 employees.

The WARN filing stated that 378 job cuts in Fremont, where Tesla's first U.S. manufacturing plant is located, included individuals involved in staffing and running vehicle assembly. Additionally, there were 65 cuts at Tesla's Kato Rd. battery development center.

Tesla didn't respond to a request for comment.

The environmental health and safety director and user experience design director were among the highest-level roles eliminated in Fremont.

In Palo Alto, where the company's engineering headquarters is located, 233 employees, including two directors of technical programs, were let go.

According to two former employees, Tesla has terminated a majority of employees involved in designing and improving customer and employee apps. The WARN filing confirms this, with many cuts made at Tesla's Hanover Street location in Palo Alto.

In the first quarter, Tesla experienced a decline in demand for its cars made in Fremont, including older models such as the Model S and X, as well as the Model 3 sedan. This resulted in a decrease in total deliveries compared to the same period last year. Additionally, Tesla reported its largest year-over-year revenue decline since 2012.

Tesla's sales in the second quarter have been affected by intense competition, particularly in China, where Xiaomi and Nio have released new EV models at lower prices than Tesla's most popular vehicles.

While the S&P 500 has risen by 11% this year, Tesla's stock price has fallen approximately 30%.

Tesla's CEO, Musk, has been urging investors to shift their focus away from vehicle sales and towards the company's potential to develop self-driving software, a robotaxi, and a "sentient" humanoid robot. Despite Tesla's long-standing promise of self-driving software that would transform existing EVs into robotaxis, the company's systems still require constant human supervision.

The team responsible for developing the Supercharger network in the U.S. was also among the recent job cuts at Tesla.

Tesla announced plans in its annual filing for 2023 to enhance its charging infrastructure to provide cost-effective and satisfactory services to customers. The company stated in the filing that it needed to expand its network to meet customer demands, following other auto companies' decision to adopt the North American Charging Standard.

Tesla has reportedly started rehiring some members of its Supercharging team, a move similar to the job cuts made by Elon Musk at Twitter after he bought the company and later rebranded it as X. Musk had previously stated that he wanted to rehire some of those he let go.

Read the latest WARN filing in California here:

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