Tesla culling 9% of staff as it chases profits

Irving Hamilton
June 14, 2018

"As part of this effort, and the need to reduce costs and become profitable, we have made the hard decision to let go of approximately 9 percent of our colleagues across the company", the e-mail read.

Tesla's Autopilot semi-autonomous vehicle tech has been implicated in numerous crashes lately, and though it's been tough to say where the blame for these incidents lies, Tesla is convinced their software isn't at fault.

Tesla is cutting 9% of its workforce as it races toward profitability, chief executive Elon Musk said Tuesday (June 12).

Tesla has not made an annual profit in its 15 years of doing business, and it has posted only two quarterly net profits. This news was qualified in a statement made by Musk, who clarified that the cuts would be targeting salaried employees, and not factory jobs, ensuring that the company's production of the Model 3 would go unaffected.

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The move is part of an organizational restructuring that Musk announced earlier in the year.

Elon Musk took to micro-blogging site Twitter to confirm that Tesla will soon lay off around 3000 employees.

Several Wall Street analysts anticipate a capital raise this year despite Musk's statements that it will not be necessary due to profitability and positive cash flow in the third or fourth quarters.

"What drives us is our mission to accelerate the world's transition to sustainable, clean energy, but we will never achieve that mission unless we eventually demonstrate that we can be sustainably profitable", Musk wrote. Tesla still has a significant need for production workers as it tries to reach Model 3 manufacturing targets, he wrote in the email. The company will seek to re-employ most Tesla employees at Home Depot stores at its own locations. It can easily top $50,000 with options.

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