To start with, Tesla opened two new factories very recently: one in Grünheide, Germany, and one in Austin, Texas. Putting them in full operation will demand hiring a lot more people, something that Tesla was having trouble with, especially in Germany. The company pays lower wages than its competitors. Tesla disputes that by stating it offers stock options that make its rates attractive. Many employees complain that they are fired before being entitled to receive these share bonuses.
Another issue relates to the alleged demand Tesla has. The company often states that it will only be able to deliver some vehicles months from now. Some derivatives – the ones already in production, mind you – will only be delivered by 2023 if they are ordered right now. That wait would be shorter for vehicles ordered with FSD, a $12,000 beta driving aid that Tesla decides if you can use or not. If demand is as high as the EV maker says it is, it would need to hire more people, not fire those who already work for it.
The way Reuters first learned the story, either Tesla did not have so much demand and needed to cut its production capacity, or it just wanted to restrict the offer and raise prices, which did not make sense with two new factories ready to expand the number of cars Tesla currently sells.
At least one person agreed to talk to Reuters about the remote work email from Musk as a strategy to reduce Tesla’s workforce: Jason Stomel, founder of tech talent agency Cadre. According to him, this has the potential to be a disguised layoff with another benefit for Tesla: avoiding severances. In an update, Reuters reported another email in which Musk mentioned only salaried workers would be fired and that hourly headcount would increase.
Despite that, it seems that the EV maker is more concerned about saving money than it says it is. We should never forget that Musk joked about Tesla’s bankruptcy risk on an April Fool’s Day when that was a genuine concern. We’ll only know about that if the Tesla CEO decides to admit that on Twitter or if the company runs into trouble. At least Musk tried to clar things: firing 10% of your employees when demand is peaking was not a good sign.
This is nothing more than layoffs in disguise....without severance. https://t.co/k0j2UJCPLn— RJR Capital (@RJRCapital) June 3, 2022