Tesla lays off employees! What on earth is Musk thinking?

According to Bloomberg, Tesla CEO Musk plans to conduct large-scale layoffs at the company, and the layoff rate may be as high as 20%. The move is related to Tesla's recent sharp decline in vehicle deliveries. It is reported that its quarterly vehicle deliveries fell by 20%. Musk believes that the proportion of layoffs should be consistent with the decline in vehicle deliveries from the fourth quarter of 2023 to the first quarter of 2024.

Tesla’s recently released data shows that in the first quarter of 2024, the company delivered 386,810 vehicles, a sharp decline of 20.1% compared to the previous quarter and a year-on-year decrease of 8.5%. This is Tesla's lowest quarterly delivery performance since 2022, showing the huge impact that fierce market competition and changes in consumer demand have on the company's business.

Musk once spoke highly of Chinese automakers, calling them the "most competitive" auto companies in the world, which also reflects Tesla's success in the global market. competitive pressure.

Previously, Musk had announced through an all-staff email that Tesla would lay off 10% of its employees worldwide, which would actually affect more than 1.4 million people. The layoffs are mainly concentrated in the US and Chinese markets. Musk explained that due to the company's rapid growth over the years and the expansion of global factories, some positions and job functions may have been duplicated, so the layoffs are a necessary step to maintain the company's "lean innovation" and desire for future development.

New employees in Tesla’s China sales department, especially those who have been employed for less than six months, have been greatly affected. Although the officially announced layoff ratio is 10%, people familiar with the matter revealed that the actual layoff ratio may be as high as 20%, or even 50% in some departments.

Tesla has cut prices on all its models globally, ranging from 3% to 6%. This is obviously to cope with market competition and boost sales. In the United States, its home base, Tesla has also lowered the prices of Model Y, S and X to attract consumers. This move should have a positive effect on market competition and boost sales, while also helping to attract more consumers.

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