Tesla employees are on edge as managers undergo assessments to determine the criticality of each role, sparking fears of potential job cuts within the company. The evaluations, carried out in recent days, come after Tesla canceled some employees’ biannual performance reviews, signaling a shift in its workforce strategy.
The move reflects CEO Elon Musk’s emphasis on cost-cutting efforts amidst a notable slowdown in Tesla’s sales growth. Musk, known for his direct approach, has previously issued ultimatums to staff, demanding alignment with the company’s vision or departure.
While Tesla representatives have not commented on the matter, the company’s shares saw a slight uptick following the news. Despite the recent gains, Tesla’s stock has experienced a 26% decline since the beginning of the year.
Tesla’s workforce has expanded significantly in recent years, with over 140,000 employees globally as of last year, representing a doubling since 2020. However, the company has made selective cutbacks in certain areas, including a round of terminations in Buffalo, New York, in February 2023.
During Tesla’s recent earnings call, Musk highlighted the company’s transition between growth phases, emphasizing the importance of cost management amidst ambitious spending plans for future projects. The company aims to allocate over $10 billion in capital expenditures this year, with increased focus on research and development.
As Tesla navigates this phase of growth, the evaluations signal a potentially challenging period for employees, underscoring the company’s ongoing efforts to optimize its operations and maintain competitiveness in the electric vehicle market.