Tesla has slashed 14% of its workforce so far this year as Elon Musk’s electric car maker has been hamstrung by increasingly fierce competition from Chinese EV firms as well as reduced demand for his products, according to a report.

As of Friday, Tesla’s internal email list numbered 121,000 people — down from a global workforce of 140,473 as of Dec. 31 of last year, according to CNBC.

The Comcast-owned financial news channel obtained an email written by Musk and addressed to “everybody” on Tesla’s payroll dated June 17.

“Over the next few weeks, Tesla will be doing a comprehensive review to provide stock options grants for exceptional performance,” Musk wrote in the email, adding that options will be given to “anyone who does something outstanding for the company.”

Musk, the second richest person in the world with a fortune valued by Bloomberg Billionaires Index at $207 billion as of Friday, told employees last Monday that the electric vehicle maker is working on stock-based compensation for high-performing employees, according to two people who reviewed an internal memo.

The plan comes just days after Musk won shareholder approval for his $56 billion pay plan consisting of stock options and two months after he announced job cuts affecting more than 10% of Tesla’s global workforce.

Earlier this month, Tesla shareholders voted to approve Musk’s $56 billion compensation package that was invalidated by a Delaware state judge.

That same judge, Kathaleen McCormick, must now once again decide whether the pay package is legal.

Her January ruling stated that the company’s board of directors, which includes Musk’s brother as well as close friends of the mogul, didn’t act “in the best interests” of Tesla.

Musk moved to incorporate Tesla in Texas. The EV maker, which had previously been registered in Delaware, has its headquarters in Austin.

Tesla last year skipped merit-based stock awards to employees, people familiar with the matter told Reuters.

Tesla’s margins took a hit last year from the company’s aggressive price cuts aimed to revive demand and fend off competition.

In April, Bloomberg News reported that Musk was seeking to cut 20% of Tesla’s workforce.

In a dramatic move, Musk fired Tesla’s entire 500-person team in charge of the company’s “Supercharger” division.

Tesla Superchargers account for more than 60% of high-speed charging ports, federal statistics show, and the company has been the biggest winner so far of $5 billion in federal funding for new chargers.

Musk subsequently said on X that the carmaker still plans to expand the Supercharger network, “just at a slower pace for new locations and more focus on 100% uptime and expansion of existing locations.”

Since Jan. 1, Tesla’s stock price has dipped more than 26%. In November 2021, Tesla’s share price exceeded $407, but since then has declined by more than 55% — wiping out some $600 billion in market value.

Since the start of 2024, Tesla shares have slumped 25% and the EV maker has warned of a sharp slowdown in sales.

Tesla’s first-quarter results missed analyst expectations, though Musk said the company would release new models in 2025 that would be more affordable.

With Post wires

Share.
2024 © Network Today. All Rights Reserved.