After Musk's wealth shrank, Tesla was suspected of laying off employees
Written by Windsor
Editor / Zhang Linyu
Design / Division
来源 / Automotive News，彭博社，路透社，商业内幕等
In January, Tesla sold only one Model Y in South Korea.
It was Tesla's worst month of sales in South Korea since July 2022, when sales were 0.
Affected by inflation, young Koreans are clutching their wallets, and the lack of charging settings makes it difficult to promote electric vehicles. According to the International Energy Agency, 90% of public charging stations in Seoul are slow. The explosion of electric vehicles in 2022 has discouraged consumers. A November survey by the Korea Transportation Safety Agency found that about half of EV owners said fire was their biggest safety concern.
The news exacerbates Tesla's woes in 2024. After breaking the news of two different recalls and the suspension of production at the German factory, Tesla's stock price fell about 25% in the first four weeks, and its market value shrank from $754 billion on January 5 to $589 billion, and CEO Elon Musk had to relinquish his position as the world's richest man.
Over the past year, Tesla has faced stiff competition from Chinese automakers, slashing prices and experimenting with advertising for the first time in history. As if that weren't enough, Tesla is likely preparing for a new round of layoffs in order to wait for the next blockbuster product.
Recently, Tesla has begun asking managers to determine which employees on the team are critical to the company, which has caused unease among employees. According to people familiar with the matter, the company also recently canceled the performance evaluation of some employees.
Four employees told Business Insider that Tesla conducts performance reviews twice a year, but employees are only eligible for a promotion or bonus once. The company says on its website that businesses rate employees on a scale of 1 to 5.
Tesla is quite stormy at the moment, and all clues are showing that Musk may repeat history. After acquiring Twitter in 2022, the billionaire had cut his headcount in half. Before the layoffs, Musk had asked Twitter's managers to rate employee performance and asked Twitter engineers to print out their own code for him to check.
When talking about the reasons for the layoffs, Musk has said that many teams at Twitter are not efficient, on the other hand, Tesla's self-driving artificial intelligence team, with only 150 engineers, surpasses the performance of other companies' 3,000-person engineering teams.
By the end of 2023, Tesla had more than 140,000 employees worldwide, double the number in 2020 and eightfold since 2016. In May 2023, Musk sent an email to the company's employees saying that he wanted to personally approve the hiring of every new employee, whether regular or contract. This is seen by the outside world as a sign that Tesla is slowing down hiring.
In the summer of 2022, Tesla suspended hiring activities and laid off about 10% of its workforce because Musk felt "very bad" about the economic outlook. However, just a few months later, Tesla began to re-recruit and increased the number of hiring positions by 50% in June ~ October of that year.
In the fourth quarter of 2023 earnings call, Tesla said that 2023 will see its first annual profit decline since 2017, and its fourth-quarter profit will fall by 40%. Tesla also warned that the growth of production, deliveries and shipments will slow in 2024.
Musk said the company is "between two waves of growth." The first wave of growth came with the launch of the Model 3 and Model Y, and the next wave of growth is expected to come from a low-cost car to be launched in the second half of next year.
"Sales growth in 2024 will slow significantly before the launch of new vehicles. Musk warned. It is understood that the new model Musk is talking about is the Model 2, and its price is expected to be around $25,000. Tesla needs to launch low-priced volume models to stimulate sales growth.
Tesla has invested heavily in the arrival of the next generation of electric vehicles and other possible growth, with a capital expenditure budget of more than $10 billion in 2024. Analysts also expect the company's R&D spending to increase to about $4.5 billion.
In response to economic uncertainty, in early 2024, dozens of American companies will lay off employees, including the popular Snap, Macy's, Microsoft, Amazon, Estee Lauder, etc. Tech companies are among the hardest hit, with 20,000 tech employees being laid off since 2024, involving 82 tech companies, according to data released by layoff tracking platform Layoffs.fyi.