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Why Elon Musk has changed his tune on Tesla staff cuts

By Nithya Bose in Employment News, posted June 7, 2022

Tesla CEO Elon Musk stated that the company's total workforce will expand over the next year, but the number of paid employees will stay unchanged.

The reports backtrack from an email sent a few days earlier, which said around 10 per cent of employee cutbacks were required.

"Total headcount will increase, but salaried should be fairly flat," Musk tweeted in a response to an unverified Twitter account's "prediction" that Tesla's workforce will increase in the following year.

Musk stated in an email to Tesla executives on Thursday, June 2 that he has a "super bad feeling" about the US economy and that he has to eliminate positions by 10 percent.

Later, Musk indicated Tesla would decrease salaried employment by 10 percent since it has grown "overstaffed in many areas," while "hourly headcount will increase."

On Friday, June 3, the company's stock dropped 9.2 percent.

In an email to Tesla workers on Wednesday, June 1, Musk gave an ultimatum to return to the office for a minimum of 40 hours per week, ahead of his emails on workforce numbers. He wrote that failure to do so would be seen as resignation.

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Musk has recently announced that Tesla's AI day has been postponed to September 30 and that a prototype of Optimus, a humanoid robot that is a company priority, might be ready by then and introduced next year.

Tesla and its subsidiaries had nearly 100,000 people at the end of 2021.

Source: Autoblog

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