Tesla to lay off 14,000 employees globally amid drop in EV sales: Report
According to a report in Electrek, Musk said in an internal mail that 'rapid growth' led to 'duplication of roles and job functions in certain areas' forcing him to make this 'difficult decision'
Even as Elon Musk is in the news in India for his highly-anticipated scheduled meeting with Prime Minister Narendra Modi this month, his electric vehicle manufacturing company Tesla is all set to lay off over 10 per cent of its global workforce.
This was revealed by a US news portal, Electrek, dedicated to electric transportation and sustainable energy.
Duplication of roles
The layoffs had become crucial after "rapid growth" led to “duplication of roles and job functions in certain areas", the Tesla CEO said in the internal email to staff, reported Electrek.
"As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity," Musk wrote, adding that as part of this effort, they have made the "difficult decision" to reduce their headcount by more than 10 per cent globally.
"There is nothing I hate more, but it must be done. This will enable us to be lean, innovative and hungry for the next growth phase cycle," he wrote, said the report.
According to Tesla's latest annual reports, the leading EV manufacturer had 140,473 employees globally. If the job cuts apply company-wide, the layoff could affect at least 14,047 employees. This announcement comes days after Tesla reported a drop in first quarter auto deliveries even though it implemented a series of price cuts on its EVs to boost demand.
Shares of Tesla fell 0.4 per cent in pre-market trading.
Meeting with PM Modi
This news also comes ahead of a much hyped-up meeting Musk has scheduled with Prime Minister Narendra Modi in India some time this month. Musk comes to India even as the country gets into its seven-phased national election from April 19.
The maverick billionaire is expected to make an announcement about his plans to open a new Tesla factory in India.
"Looking forward to meeting with Prime Minister Narendra Modi in India!" he had posted on his X profile. Musk also had said it is a "natural progression" for Tesla to provide electric vehicles in India.
India's EV policy
India has just announced a new electric vehicle policy which plans to cut taxes on EV imports by almost 85 per cent. Under the new policy EV manufacturers have to invest a minimum of ₹ 4,150 crore and they have to set up manufacturing facilities in the country within three years.