Nikola Motors Goes on Hiring Spree, Offers Work to Laid-Off Tesla Employees
Nikola says it has hundreds of openings and will fund them using its "large cash reserves."
After making the decision to lay off more 3,000 employees earlier this month, electric car manufacturer Tesla has been the subject of increased negative attention from the industry and Wall Street. Rival startup Nikola has taken full advantage of the situation by using it as a potential for talent acquisition. CEO Trevor Milton took to LinkedIn, offering up priority interviews for those who were affected by the layoffs at Tesla.
"Forward this on to all Tesla workers. Anyone who was affected by the #tesla layoffs, please let me know and I'll try to get you in front of our HR to be reviewed." wrote Milton in a LinkedIn Post last week, "We have hired as many as fit our positions from the #faraday and #gm layoffs so this is not a bash on Tesla. We are hiring hundreds of positions and have large cash reserves with a great company culture."
Two weeks ago, Tesla CEO Elon Musk announced that the automaker would be trimming the fat on one of the most draining sources of company expense: human labor. Approximately 7 percent of Tesla's workforce (which totals 45,000 employees) will be cut. Shares for Tesla fared well after the initial announcement, however, tumbled nearly 13 percent following the release of the memo sent to employees that shed more light on the situation.
In the memo, Musk explains that one of its primary driving forces in cutting staff is the need to lower the overhead costs of its lowest-priced sedan, the Model 3. The long-promised $35,000 affordable electric car has been out of reach for some time at its long-promised price point. Musk has gone on record, stating that as of Q3 2018, the Model 3 could not be produced with reliable profits at its target price despite discussing the possibility of a $25,000 car by 2021.
Milton later defends Tesla's decision to cut its staff, acknowledging that the EV market is becoming increasingly competitive. He writes: "I feel for everyone that goes through that especially with financial obligations. If #tesla could they would keep everyone but it's the result in growing in a competitive market. I hope I can help all those affected."
The relationship between Tesla and Nikola has been long-strained, especially following a $2 billion lawsuit which alleges that Tesla's Semi truck offering is eerily similar to its own Nikola One; including a wraparound windshield, mid-entry doors, and its "overall design". Much like Tesla, however, Nikola does not yet have a product on the market that buyers can make active in their fleet today. Nikola once boasted about receiving more than $8 billion in reservations, meaning that it had somewhere in the neighborhood of 7,000 trucks on pre-order with different companies. In comparison, Tesla is believed to have somewhere around 650 reservations on its upcoming Semi.