Tesla to slash salaried staff by about 10% in the next three months

Overall reduction to be 3.5% as hourly staff expected to grow

Elon Musk confirmed the salaried workforce at Tesla would be cut by about 10 per cent over the next three months, but said the overall reduction in the electric-car maker’s workforce would only be some 3.5 per cent as hourly staff numbers are still expected to grow.

“We grew very fast on the salaried side,” Musk said in an interview with Bloomberg News Editor-in-Chief John Micklethwait at the Qatar Economic Forum on Tuesday. “A year from now, I think our headcount will be higher” in salaried and hourly workers, but for now the reduction will be 3 per cent to 3.5 per cent.

The comments brought more clarity to the situation with Tesla’s staffing, after Musk made varied internal and public statements about reductions over the past month.

Tesla, now headquartered in Austin, Texas, has grown to about 100,000 employees globally, hiring rapidly as it built new factories in Austin and Berlin. The cuts, which have affected human resources representatives and software engineers, caught many by surprise, with several employees told they were being terminated immediately. Musk, 50, waded into the work-from-home debate earlier this month, laying down an ultimatum for Tesla staff to return to the office, or leave. 

“Everyone at Tesla is required to spend a minimum of 40 hours in the office per week,” Musk wrote in an email titled “To be super clear.” “Moreover, the office must be where your actual colleagues are located, not some remote pseudo office. If you don’t show up, we will assume you have resigned.”

“The more senior you are, the more visible must be your presence,” Musk had written.

Firm may need to boost wages in Germany

Electric carmaker Tesla is having to raise wages to attract employees to its new manufacturing plant outside Berlin, a top German union said, warning of a looming pay dispute among the workforce at the Gigafactory in Gruenheide, which began production in March 2022.  Many interested in switching to Tesla “earn significantly more in their current jobs at other automakers,” Birgit Dietze, a regional representative for IG Metall said (Reuters).