Tesla will lay off more than 10% of its employees worldwide

After recording a drop in sales of electric cars for the first time, Tesla will lay off more than 10% of its employees around the world. The mass layoff is another sign of the slowdown of Elon Musk’s company in the face of competition and market development.

Around 14 thousand people will be laid off. In total, Tesla employs 140,473 people, according to the British newspaper The Guardian. Two high-ranking executives announced their resignations on the social network X, which also belong to Musk: Tesla’s senior vice president, Drew Baglino, responsible for battery development, and Rohan Patel, vice president of public policy and business development .

According to the website Electrek, Musk’s email talking about the cuts was leaked. In it, the businessman says that “Tesla has grown rapidly in recent years and, as a result, there has been a duplication of roles and functions in certain areas.” The website says that there are reports that some employees have already had access to the system blocked at the electric car company.

Tesla has not yet commented on the layoffs.

It is not new that the company has been facing difficulties and distrust from investors who think that Musk’s company is out of date, especially with the growth of others. While in China Tesla’s main competitor is BYD, in Europe, Volkswagen and BWM reinvent themselves with new products.

The scenario is that, in addition to lower sales and layoffs, Tesla has a 30% drop in shares this year.

When the negative first quarter results came out a few weeks ago, the company attributed the decline in sales to upgrades at the Fremont, California, factory for the initial phase of Model 3 production, to factory shutdowns caused by the Red Sea conflicts and also due to an arson attack at GigaFactoty, in Berlin, Germany.

According to Electrek, next week, Tesla will deliver its quarterly earnings report and expectations are not the best either. Analyst estimates point to earnings of US$0.50 per share, below the US$0.85 in the first quarter of 2023.