▲ “Layoff Email”
On June 4, British local time, a Reuters reporter reported that he had seen multiple emails from Musk to executives and employees. Musk said in an email that he felt the economy was so bad that he wanted to suspend global hiring, cut 10% of salaried employees, and increase hourly workers.
According to Tesla’s annual SEC filing, Tesla employed a total of 99,290 employees (both salaried and hourly workers) by the end of 2021.
In 2018 and 2019, Tesla has laid off 9% (about 4,000 people) and 7% (about 3,500 people) successively. Because the current number of employees is larger and the proportion of layoffs is higher, there is no doubt that the total number of layoffs will exceed 4,000, which will be Tesla’s largest layoff in recent years.
So what regions are involved in this wave of layoffs by Tesla? Which departments and positions are laying off workers? Can Chinese companies, whose sales have been exploding, “succumb to disaster”?
01
Singapore manager resigned, US middle-level also affected
Tesla Singapore country manager Christopher Bousigues was fired after Musk announced the layoffs. Christopher Bousigues’ LinkedIn profile shows that he has been with Tesla for more than a year since June 2021.
Christopher Bousigues did not give a specific reason for his dismissal in his LinkedIn post. He only said that the position of the Singapore regional manager was “cancelled”, and also said that it was related to the layoffs planned by Tesla, and then detailed him. Contributions made at Tesla.
▲Christopher Bousigues LinkedIn homepage
The post shows that Christopher Bousigues’ work is more about developing the Singapore market. He led the team to build 2 showrooms, 1 service center, added 7 charging stations, and also listed Model Y in “Po County”.
However, these jobs cannot hide the failure of Christopher Bousigues’ tenure. According to Twitter user Daren Yoong, due to the Shanghai epidemic, Tesla only had nine vehicle registrations in Singapore in May, and there were not many other months. Other users revealed that at the same price as Tesla, luxury brands such as BMW and Audi are the most popular in Singapore.
▲ Twitter user Daren Yoong tweet
Therefore, Tesla’s choice to lay off Christopher Bousigues may still be a wise choice, after all, Tesla’s profit in Singapore may not be as high as the executive’s annual salary. If it continues to retain this position, Tesla may continue to bear this part of the loss.
In addition to the dismissal of the Singapore regional manager, Tesla has also laid off some mid-level managers. At present, several Tesla middle-level leaders have posted on LinkedIn that they miss and appreciate their work at Tesla and hope to find new jobs as soon as possible. Some of these middle-level leaders are inter-departmental senior managers, some are senior technical trainers related to solar roofs, some are technical R&D managers in the energy training department, and some are regional warehouse managers.
▲Laid-off mid-level employee Andrea Armagost, M.Ed LinkedIn homepage
In the job posting, Andrea Armagost, M.Ed, the technical research and development manager of the energy training department, said that at Tesla, she led editors, animators and technical learning experts to advance her work, and she was proficient in system design and development. An executive job related to it.
In addition to the middle-level layoffs, Tesla has also laid off many ordinary employees this time, even hourly employees. Lane Salbacka was laid off a few days ago as an hourly employee who worked at Tesla for five and a half years.
However, in the job posting, Lane Salbacka also expressed gratitude to Tesla, thanking Tesla for paying him enough wages to allow him to buy a house without relying on his parents. He hopes to find a new job close to home.
▲Lane Salbacka’s LinkedIn homepage
02
China is suspected of starting layoffs, and many recruitments have been suspended
In addition to laying off employees overseas, some people have also posted reports under the entry “Tesla China started layoffs after the explosion” recently, but the authenticity is doubtful. A user with the tag “Tesla employee” confirmed that layoffs have begun, but the news remains to be verified.
▲ Maimai “Tesla China was exploded to start layoffs” entry
In addition, there are also Tesla China employees on Maimai that there are no layoffs in China and they are still recruiting normally.
However, there are also posts suspected of being laid off from employees in China, revealing that they have signed a non-disclosure agreement and can only say that “the labor relationship will be terminated amicably with Tesla.” There are also some posts that are currently unavailable, and the authenticity is yet to be determined.
However, Twitter user BoldProgressices.org also revealed that Tesla’s foreign laid-off employees have signed a non-disclosure agreement with Tesla, guaranteeing that they will not attack the company, company products and colleagues after leaving, otherwise they will need to compensate, so those employees’ posts on LinkedIn All seemed very friendly. Suspected layoffs of Tesla employees in China may have signed a similar agreement.
▲ Suspected confidentiality agreement (Source: Twitter user BoldProgressices.org)
Although it is uncertain whether Tesla China is laying off employees, it is certain that Tesla is shrinking in many departments.
According to Reuters, Tesla has cut jobs posted abroad by about 14% since Musk warned of concerns about the economy, the need for layoffs and a pause in global hiring.
According to data provided to Reuters by Thinknum Alternative Data, the number of job postings on Tesla’s foreign website has fallen to 5,011 from 5,855 at the beginning of the month, a 32% drop from its recent high on May 21.
In addition to the shrinking of overseas positions, Tesla’s recruitment in China is also slowly decreasing. It is worth noting that although the Shanghai factory has resumed work, perhaps affected by this layoff, Tesla has canceled three recent online recruitment events in China.
▲ Sina Finance reported that Tesla canceled three online recruitments
03
Shares fall, laid-off workers launch class-action lawsuit
However, Tesla’s layoffs are not so easy. According to Reuters, two employees at a battery factory in Nevada recently violated federal law on the grounds that Tesla carried out large-scale layoffs without notifying employees 60 days in advance. With a petition to go to court with Tesla in federal court in Texas, Tesla is required to compensate the laid off employees for 60 days of wages and other accrued benefits.
Meanwhile, the appellant employees are also seeking a class-action lawsuit for all former Tesla employees across the U.S. who were fired in May or June without prior notice. Tesla laid off more than 500 employees at its Nevada battery factory, lawsuits show.
▲ Reuters reported Tesla was laid off employees lawsuit
But Musk dismissed the significance of the lawsuit at the Qatar Economic Forum, saying it “has no standing.” Perhaps this is a piece of cake compared to other lawsuits Tesla has faced before. However, Musk still said in an external interview that they expected a decrease of about 10% in salaried employees, which was actually only a 3% to 3.5% reduction in the total number of employees. It is not certain whether Musk is trying to save his respect. After all, the salaried and hourly employees who have been laid off on LinkedIn have admitted to “10% layoffs.”
It is understood that Tesla’s layoffs are ostensibly to reduce the company’s operating costs, followed by a drop in stock and a surge in competition.
On June 16, local time in the United States, foreign media TheStreet reported that Tesla’s stock has fallen by about 50% from its highest point.
On June 21, Tesla’s U.S. stock price fell to $650.28 per share (equivalent to about 4,354.7 yuan per share), while Tesla’s U.S. stock price peaked at $1,222.09 (equivalent to about 8,184.3 yuan per share). And in the past six months, Tesla’s US stock price has been falling dynamically.
▲ Tesla US stock price trend (as of June 21)
Musk has also been criticized as Tesla’s stock has fallen. Many commentators have accused Musk himself of trying to buy Twitter with money from his Tesla stock, which has driven down Tesla shares and spooked investors.
They also pointed out that Musk’s recent political rhetoric may alienate interested Tesla-buying groups, which are typically liberal and environmentally conscious.
▲ Graffiti wall in Tesla’s Berlin factory
On top of that, the layoffs come at a tough time for the company, as more electric-vehicle rivals take Tesla’s market dominance and Tesla’s stock price is falling sharply.
However, Musk also had to admit at the Qatar Economic Forum that “a recession is inevitable at some point. As for whether there will be a recession in the short term, it is very likely.”
▲ Musk participated in the Qatar Economic Forum remotely
04
Production pressure intensifies, Musk emails back to lick employees
Although layoffs are advancing, Musk has not forgotten to boost morale.
▲The drone photographed the new car next to the Texas factory
Musk revealed in an internal email that the quarter was very difficult, with some challenges in the supply chain and production in China. Fortunately, the production of the Fremont factory is proceeding in an orderly manner, the production capacity of the Berlin factory can reach 1,000 vehicles per week, the Shanghai factory has also ushered in the resumption of work, and the Austin, Texas factory is also accelerating its production capacity.
▲ Musk sent an email to boost morale
Maybe Musk is still worried that layoffs will scare current employees, and he specially sent a “heartwarming email” to express respect and admiration for employees and encourage existing employees to work hard. Compared with the attitude of the first warning to telecommuting employees, this attitude is really heaven and earth.
▲The first Model Y owners of the Texas factory
However, Musk did this for no reason. After all, foreign Tesla Model Y orders have been placed until next year.
Although the recently launched 4680 version of the Model Y all-wheel drive version is open to users who are waiting for delivery, there are not many people who buy it. After all, the 4680 version is not much better than the original 2170 version.
▲Tesla’s email to users to be delivered
Therefore, Tesla is still facing a lot of delivery pressure. According to Bloomberg, Tesla is also facing supply chain instability and parts shortages that many automakers need to deal with. At this time, large-scale layoffs also have a certain negative impact on Tesla’s current production.
05
Conclusion: Epidemic and inflation or layoff incentives
Affected by factors such as the epidemic and the conflict between Russia and Ukraine, the world economy is in turmoil. Musk has also publicly stated on multiple occasions that a recession is very likely in the short term. Recently, many foreign media have also voiced that the recent high inflation will accelerate the risk of world economic recession.
Therefore, Musk, the world’s richest man, can’t sit still, and Tesla is not the only company to lay off employees. In the face of recession and inflation, perhaps the best thing Musk can do is to cut costs.
In addition to safeguarding their rights and interests through legal means, the laid-off employees can do in the short term, relying on the endorsement of Tesla’s accumulated work experience to quickly change jobs to minimize personal losses. After all, Tesla isn’t alone in laying off workers.
