Tesla undecimates its workforce but Elon insists everything's absolutely fine

Tesla undecimates its workforce but Elon insists everything's absolutely fine

Tesla confirmed that only salaried employees will be laid off and no production associate will be let go as Tesla is still focused on increasing Model 3 production.

At the same time, the job cuts announced today will reduce Tesla's costs, allowing the company to reach profitability more easily.

Electric vehicle maker Tesla Inc.is laying off about 3,600 workers mainly from its salaried ranks as it slashes costs in an effort to deliver on CEO Elon Musk's promise to turn a profit in the second half of the year. "We made these decisions by evaluating the criticality of each position, whether certain jobs could be done more efficiently and productively, and by assessing the specific skills and abilities of each individual in the company", Musk said.

Given that Tesla has never made an annual profit in the nearly 15 years since we have existed, profit is obviously not what motivates us.

In the note, which he tweeted out after it was leaked to media outlets, Musk said that almost all of the cuts would be salaried positions, and that the production staff is largely unaffected. Instead, he said that the cuts were made to job functions that, "are hard to justify today".

Musk wrote in the email that the company will never achieve its mission to help move the world to cleaner energy "unless we eventually demonstrate that we can be sustainably profitable".

Musk told employees in May that the company was undergoing a "thorough reorganization" as it contends with production problems, senior staff departures and recent crashes involving its electric cars. Year-to-date, Tesla's headcount is up roughly 15%.

A sign is seen outside Tesla Motors' new showroom in Manhattan's Meatpacking District in New York City, U.S., December 14, 2017.

The move follows Tesla starting a brutal review of contractors and firing everyone that is not vouched for by an employee last month. So a nine-percent cut means letting more than 3,000 workers go.

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