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At the beginning of the month, Tesla reported falling sales of electric vehicles, and now the market leader is preparing to lay off at least 14,000 employees – 10% of the entire workforce (140,473) at the beginning of 2024. This is reported by Electrek and Reuters, which received a copy of the internal letter of instruction sent on behalf of CEO Elon Musk.
Which Tesla teams will be laid off is still unknown. In an address to employees, Tesla CEO Elon Musk called the dismissal decision the worst, but forced and necessary.
“This is what I hate most, but it needs to be done. This will allow us to be more lean and innovative before the growth phase of the next cycle.”
Elon Musk,
Co-founder and CEO of Tesla
Based on the results of the first quarter of 2024, Tesla «won» BYD after the first knockdown in the last quarter of 2023 and regained leadership in the global electric vehicle market. But Tesla’s sales fell in annual terms for the first time since the coronavirus 2020: in total, Elon Musk’s company shipped 386,810 electric vehicles to customers—8.5% less than in the same quarter of 2023 (422,875).
Tesla will publish its full financial report on April 23, then we will be able to find out how much the key financial indicators will deteriorate – just remember that the consequences of the price war were not long in coming. As of now, Elon Musk's company has exhausted the potential for further price cuts in China, which remains the company's largest market, and profitability continues to fall amid slowing growth in Europe and the United States.
In early April, Reuters reported that Tesla had changed its mind about releasing the affordable Model 2 electric car for $25,000, which Musk first announced in 2020, and instead decided to focus on the new Robotax, whose release date has already been pushed back several times since 2020. In response, Elon Musk called the Reuters reports «lies» and announced the robotaxi announcement on August 8th. There is an assumption that Tesla did not actually cancel the release of Model 2, and on August 8, Tesla will present two identical-looking car models: one of them will be a robotaxi without a steering wheel or pedals, and the other will be a compact car. At the same time, Tesla may announce the start of production of Robotaxi, and push the version with a steering wheel and pedals to a later date.
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