“In the past few decades, Tesla has grown and developed very quickly, but it has resulted in duplication of some jobs and job functions. Perhaps in the past, these positions are meaningful, but today it is difficult to play them. Some of the effects were partly due to organizational restructuring considerations, and we also made a difficult decision to cut costs and increase revenues. Tesla would have to lay off 9% of its employees.” Tesla CEO Elon • Elon Musk wrote in an email on Tuesday (June 12). custom plastic manufacturing
It is reported that this will be the largest layoff since the establishment of Tesla.
Musk also emphasized in the email that the layoffs do not include employees related to production jobs, and Tesla’s ability to achieve Model 3 production targets in the coming months will not be affected by layoffs. Affected by this news, the share price of Tesla (NASD:TSLA) rose by 3% on the same day. custom plastic manufacturing
To enhance the efficiency of the Tesla management structure:
At present, the high-profile production target of Model 3 has not yet been reached. Under the pressure of rapid money-burning and cash flow, Tesla decided to perform the largest layoff in its 15-year history.
It is reported that this week Tesla will start to inform those employees who have been laid off. In order to make up for the impact of the layoffs on these employees, Musk stated in the email that they will be given a generous salary and stock vesting. The specific ratio depends on how long each person works in Tesla. According to a news report from a Tesla employee reported by Bloomberg News, Tesla is expected to pay this salary by mid-August and pay the share cash before the beginning of September.
For the selection of the redundancy list, Musk stated that by assessing the criticality of each position, whether certain tasks can be completed more efficiently and with higher producing areas, and assessing the skills and abilities of everyone in the company, the final decision is made. List of layoffs. custom plastic manufacturing
In May 2018, Musk stated that Tesla is flattening its management structure to increase efficiency and integrate certain tasks that will not affect Tesla’s important tasks.
According to earlier reports, at the end of 2017, Tesla had more than 37,500 employees worldwide, and in 2010, Tesla had only 899 employees. In the past four years, Tesla’s employees have grown at a faster rate than its revenue growth rate for three years. However, the increase in the number of employees has not brought about a significant increase in production volume. According to the 2017 Automotive News report, Tesla’s annual employee productivity in 2016 was only one-seventh of the annual production efficiency of workers at the NUMMI plant (predecessor of the Tesla Fremont plant) ten years ago.
For those important positions, Tesla is still looking for talents. The reporter noted that Tesla’s official website is currently recruiting jobs, mostly engineering and sales. In addition, Musk stated in the e-mail that he had decided not to sign a home sales agreement with Home Depot in order to focus solar sales (4.220, 0.05, 1.20%) on Tesla stores and online. Most employees working at Home Depot will have the opportunity to work at Tesla’s retail outlets. custom plastic manufacturing
In the 15 years since its establishment, it has never achieved annual profit:
According to Bloomberg News quoted Cowen & Co analyst Jeff Osborne as saying, “Taking into account the challenges of capacity targets, the intense competition, and debts that are almost due on the balance sheet, we still The holdings are reservations. This layoff is reflecting Musk’s recent commitment to profitability.”
For Tesla’s profitability, Musk also admitted in the e-mail that “Since the establishment of Tesla, we have never achieved annual profits in these 15 years. It is clear that the interests are not the driving force for our progress. Drive us It is the mission of accelerating the transformation of this world towards sustainable new energy. However, if ultimately we cannot prove that we can make sustainable profits, we will never be able to achieve our mission. This is what has been so far and powerful to Tesla. A fair criticism.” custom plastic manufacturing
According to Bloomberg News, Tesla has accumulated about 5.4 billion U.S. dollars in losses so far, and even supporters who are optimistic about Tesla do not believe this figure will solidify.
The reporter noted that in 2015, Tesla’s net loss was approximately 889 million U.S. dollars, and it declined slightly to 670 million U.S. dollars in 2016. However, this figure soared to 1.96 billion U.S. dollars in 2017, and the net loss increased significantly in one year. It is reported that in March 2016, the company released Model 3 to the public and began to deliver the car to the first batch of 30 customers in July 2017. At the time, Tesla stated that it would produce 1,500 units in September 2017. Tesla’s surge in net losses from 2016 to 2017 is closely related to the mass production of the Model 3, and Tesla is still trying to catch up with its planned mass production target of 5,000 units per week. According to Bloomberg News, citing analysts’ estimates, Tesla may lose 1.3 billion U.S. dollars in the next four quarters. custom plastic manufacturing
This layoff is expected to save Tesla about $80 million in operating expenses per quarter, according to Bloomberg, quoting an email from Gene Munster, a partner at venture capital firm Loup Ventures. Said, “With Tesla burning at such a high rate, in order to have a big impact, 80 million US dollars may not be enough. But in the next few months, every penny may determine Tesla’s fate”. custom plastic manufacturing