According to media reports, Tesla disclosed in a regulatory filing on April 24 that the company anticipates recording over $350 million in layoff costs for the second quarter due to a global large-scale layoff that began last week.
On April 15, Tesla CEO Elon Musk notified employees that the company would be conducting layoffs "exceeding 10%" globally to prepare for "the next stage of growth" by reducing costs and improving productivity. In other words, with Tesla having 140,000 employees worldwide, at least 14,000 employees are expected to lose their jobs.
Additionally, Bloomberg reports suggest that the number of layoffs at Tesla may be higher than announced. Sources familiar with Tesla's plans revealed that Musk had aimed to reduce Tesla's workforce by 20% to align with the sales decline in the first quarter, indicating that the number of layoffs could exceed 20,000 people.
Currently, Tesla has begun implementing specific layoff plans globally. The latest reports indicate that Tesla will lay off a total of 6,020 people in Texas and California. According to U.S. labor regulations, companies with over 100 employees must provide a 60-day notice before closing a plant or conducting mass layoffs. Therefore, Tesla's announcement indicates that starting from June 14, 3,332 people will be laid off in California, and 2,688 in Texas.
Texas is home to Tesla's Gigafactory and headquarters, with the layoffs accounting for 12% of its total workforce of 22,777 in the region. In California, where Tesla has created over 30,000 manufacturing jobs, the layoff rate also exceeds 10%. Apart from Texas and California, Tesla has also laid off 285 employees at its Buffalo, New York factory, representing 14% of the local workforce.
In Germany, Tesla will lay off around 400 people at its Berlin Gigafactory, accounting for about 3% of the factory's total workforce. Tesla stated that it is currently in negotiations with the factory's workers' council in Berlin, hoping to achieve layoffs without mandatory terminations.
The Tesla Berlin factory is responsible for producing the Model Y and is Tesla's only factory in Europe, employing over 12,000 people. Joerg Steinbach, the Minister of Economic Affairs for Brandenburg, Germany, said, "I am very sorry about the layoffs announced at Tesla's Gruenheide factory. However, I am glad that the layoffs will be implemented in a reasonable manner. Compared to other areas, the extent of layoffs at the Gruenheide factory is relatively moderate."
