According to reports, Tesla has significantly reduced its employment, affecting over 10,000 employees, under the leadership of its billionaire CEO, Elon Musk.

According to sources, over 10% of Tesla’s global workforce roughly 14,000 employees—is impacted by the layoffs, which were verified by an email sent out to the entire company.

This decision is part of a larger effort to reduce costs in the face of financial strains, which have resulted in a 23% reduction in profits and the first quarterly decline in growth in car deliveries in four years. It’s yet unclear precisely which departments will be impacted.

Some senior Tesla officials have resigned along with the layoffs. Both senior vice presidents of powertrain and energy, Drew Baglino, and vice president of public policy and business development, Rohan Patel, announced their resignations.

Tesla Implements a MWR
Tesla Implements a MWR

Elon Musk apologized for the layoffs to staff members, but he believed they were essential for Tesla’s upcoming expansion.

He reaffirmed the necessity of organizational reform every five years, a tactic that was also mentioned in the wake of Tesla’s dismal January financial report.

The layoffs are taking place as a result of Tesla shifting its emphasis to constructing a new robotaxi rather than continuing with plans to build a $25,000 Model 2.

This change, of course, coincides with heightened rivalry, especially from Chinese producers such as BYD, which just overtook Tesla in the world’s EV manufacturing.

Tesla’s rival company, BYD

In contrast to general market trends, Tesla’s shares underperformed after the announcement, declining by almost 6%.

This decrease adds to the more than 30% year-to-date loss in the value of Tesla’s stock, which indicates investor apprehension regarding the company’s immediate difficulties.

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