The layoffs are reportedly expected to impact at least 14,000 employees.
Tesla will lay off more than 10% of its salaried workforce, according to an internal company-wide email sent to employees by CEO Elon Musk and seen by media outlets.
Reuters on Monday cited an email sent to at least three US employees notifying them that their dismissal was effective immediately.
According to EV blog Electrek, which was the first to report on the layoffs, it is not clear which teams at Tesla will be impacted. With the company’s headcount sitting at around 140,000 workers globally, the reduction is likely to affect at least 14,000 employees.
“As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” Musk reportedly said in the memo sent to all staff.
“As part of this effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally. There is nothing I hate more, but it must be done,” the memo said.
Commenting on the layoff reports, Musk posted on X (formerly Twitter): “About every five years, we need to reorganize and streamline the company for the next phase of growth.”
The last time Musk announced major job cuts was in 2022, after telling executives he had a “super bad feeling” about the US economy. He indicated at the time that he believed that the company was overstaffed.
The latest reports on jobs cuts come as the US carmaker has been grappling with falling sales and fierce competition from Chinese electric vehicle (EV) makers.
According to a Reuters report earlier this month, which was later denied by Musk, Tesla has scrapped a long-planned project for a low-cost vehicle and will instead focus on a new robotaxi.
This month, the company reported its first annual decline in vehicle deliveries since 2020. On Tuesday, Tesla is scheduled to report first-quarter financial results and may provide more details about the layoffs, according to media reports.