Job cuts: Tesla, led by billionaire Elon Musk (pictured), has been hit by weak demand for electric vehicles
Tesla is laying off more than 10 percent of its global workforce as it grapples with falling sales.
The American automaker, led by billionaire Elon Musk, has been hit by weakening demand for electric vehicles (EVs) and a price war with Chinese rivals.
Musk told staff that the sacrifice of more than a tenth of the workforce “must be made,” setting the stage for job cuts.
“We have conducted a comprehensive review of the organization and have made the difficult decision to reduce our workforce by more than 10 percent globally,” he said.
‘There is nothing I hate more, but it has to be done. This will allow us to be efficient, innovative and eager for the next cycle of the growth phase.”
Tesla is estimated to have 140,000 employees, meaning up to 14,000 will lose their jobs, and hundreds of jobs could be lost in the UK.
Recent filings suggest Tesla employs around 1,000 people in Britain. The layoffs come at a difficult time for the group.
Earlier this month, it reported its first drop in car sales in four years after delivering 386,810 vehicles in the three months to the end of March.
It was enough to regain its crown as the world’s biggest seller of electric cars after a drop in sales at Chinese rival BYD.
But the total was down by more than a fifth from the previous quarter and about 9 percent less than the same period in 2023.
BYD surpassed Tesla in the last quarter of 2023 when it sold 526,409 electric vehicles compared to Tesla’s 484,507.
After years of rapid sales growth that helped make Tesla the world’s most valuable automaker, the company is bracing for a slowdown in 2024.
In January, Musk warned that Chinese automakers were on the verge of “demolishing” their global rivals and that growth this year would be “markedly lower” than in 2023.
The company recently cited “shipment diversions caused by the Red Sea conflict” and an arson attack on its Berlin factory for slowing its production rates.
Tesla, which will report its quarterly earnings next Tuesday, already laid off 4% of its New York workforce last year.
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