Tesla has been trying various methods to reduce its costs, and this time, the company has laid off around 200 employees as a cost-cutting measure from its California-based branch, San Mateo. A major proportion of the laid-off employees consists of hourly workers who were being deployed on the “Autopilot driver-assistant system” project. The workers are really not happy with this sudden decision.
However, on the other hand, Elon Musk, who is the CEO of Tesla and SpaceX, had already given a hint about the layoff of employees during a meeting with top managers at the start of this month. He said he had a “super bad feeling” regarding the economic conditions worldwide and how inflation is rising day by day. He was of the opinion that we should start reducing costs in the manufacturing of electric cars, and he clearly stated that the staff needed to be reduced by up to 10% in order to carry out the operations smoothly and efficiently.
However, he stated that the 10% job cuts would be applicable to salaried workers only and would have no impact on hourly workers, but this sudden job cut for hourly workers was somewhat shocking to the employees. Raj Rajkumar, who is a professor of electrical and computer engineering at Carnegie Mellon University, said, “Tesla clearly is in a major cost-cutting mode. This (staff reduction) likely indicates that 2Q 2022 has been pretty rough on the company due to the shutdown in Shanghai, raw material costs, and supply chain problems. “
One of the employees who were being laid off at the California-based branch said that they were informed of the shift to another Tesla branch, which is located in Palo Alto, a city in California, but apart from this plan, they were entirely laid off from the San Mateo office, and that was pretty strange for them. He said, “It was definitely kind of numbing. Yeah, we’re definitely shocked; we’re definitely blindsided. ” The majority of these employees work in “data annotation” positions at Tesla, where they review and classify different samples of data collected visually from Tesla vehicles to implement it on the Autopilot driver assistant system and then programming the system on the cars to handle different road scenarios.
Most of these Tesla workers who were being laid off from the California branch yesterday took it to LinkedIn and said, “So kind of a disappointing day today. I, along with almost the whole San Mateo Branch at Tesla, just got laid off. ” It is apparent that Musk has been very concerned regarding the financial condition of Tesla and said that its factories in Texas and Berlin are “gigantic money furnaces” which are losing billions of dollars. Therefore, he is implementing cost-cutting measures at large.