Tesla is laying off more than 10% of its global workforce, an internal memo seen by Reuters on Monday shows, as it grapples with falling sales and an intensifying price war for electric vehicles ."About every five years, we need to reorganize and streamline the company for the next phase of growth," CEO Elon Musk commented in a post on X.
Less than a year ago, Tesla's chief financial officer, Zach Kirkhorn, left the company, fueling concerns about succession planning. Reuters saw an email sent to at least three U.S. employees notifying them their dismissal was effective immediately.The layoffs follow an exclusive Reuters report on April 5 that Tesla had canceled a long-promised inexpensive car, expected to cost $25,000, that investors have been counting on to drive mass-market growth. Musk had said the car, known as the Model 2, would start production in late 2025.
Tesla shares have fallen about 33% so far this year, underperforming legacy automakers such as Toyota Motor and General Motors, whose shares have rallied 45% and about 20% respectively.