The automotive market is looking like it will become tougher in 2024, and in no segment is that more apparent than in the EV space. Even Tesla, which has led the segment, and produced one of 2023’s most popular vehicles in the world, is looking to tighten the belt, and that may mean layoffs.
The company stoked fears that it was looking for places to cut staff after asking managers which of their employees’ positions were critical. Whereas Tesla normally asks them to rate their subordinates on a scale from 1 to 5 every six months, it canceled some of those reviews this year, and asked simply if an employee’s job was critical to the company.
Read: Tesla Sold Just One Car In South Korea Last Month As EV Market Stalls
While no layoffs have yet been announced, the company is in an uncomfortable position. Bloomberg reports that Tesla’s headcount has about doubled since 2020, and that it now employs 140,000 people globally.
In fact, the number of people in its employ rose by about 10 percent in 2023 alone, but a grim outlook for 2024, and high R&D costs are pushing Tesla to consider every cost saving measure. Speaking late last month, Vaibhav Taneja, the company’s chief financial officer, said the company is actively looking to save money.
“This is a constant exercise, and we just have to chase down every penny possible,” Taneja said. “We have a strong team which is hyper-focused on this.”
While this certainly wouldn’t be the company’s first round of layoffs — dozens of employees were terminated in Buffalo last February shortly after a union campaign was announced, two events that were unrelated, according to the automaker — it was still growing at the time. It’s less clear if the automaker will be able to continue growing.
The company plans on spending $10 billion in the coming year, and analysts expect spending to grow as Tesla works on its low-cost compact EV. Indeed, the company’s CEO, Elon Musk, has admitted that the company is “between two major growth waves,” between the launches of the Model 3 and Y, and the upcoming launch of what many expect will be called the Model 2.
That said, the company still has hundreds of job listings on its website, which may mean that Tesla isn’t looking to reduce headcount.
