Tesla will be severing a solid 7 percent of their full-time workforce, according to an announcement made Friday.
The electric automaker is looking to reduce the company overhead, and in turn, make the Model 3 sedan more affordable. To help reach their goal of setting a $35,000 price tag for Standard models, they will be laying off around 3,000 employees.
In the email detailing the decision, Tesla CEO Elon Musk pointed out that the company experienced a 30 percent increase in jobs in 2018. This totals to approximately 45,000 jobs according to Bloomberg.
Tesla is well known for their cash-burning business practices. They're GAAP reported profits were at $312 million when total revenue was around $6.8 billion. Musk considered this the company's first "meaningful profit" in the last 15 years. These layoffs may mark a new trend of fiscal frugality.
Musk also remarked that while production and deliveries are expected to rise, profits will not. Last year's profits were driven by high-end options while Tesla is looking to make the more affordable models more widely available.
Tesla to Lay Off 7 Percent of Their Workforce
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Posted On: Jan 18, 2019 @ 02:24 PM