Elon Musk Ends a Whirlwind Week Hinting Big Layoffs at Tesla

Musk reportedly also warned employees they would be fired for not working in office.

byAaron ColeJun 3, 2022 10:54 AM
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Elon Musk sent top Tesla managers an email Thursday telling them to freeze hiring and brace for coming layoffs, Reuters reported. The email by Musk, which was cited but not quoted beyond the subject "pause all hiring worldwide," allegedly told Tesla brass that a workforce reduction of about 10 percent would be necessary because of his "super bad" feeling about entering a recession. It's not the first time he's made waves about the fragility of Tesla's future.

The email Thursday follows closely another missive by Musk, reportedly sent out earlier this week, that warned employees that if they didn't return to office work, they would be fired. "If you don't show up, we will assume you have resigned," he wrote. Tesla didn't immediately comment to The Drive on this story.

Industry insiders speculated Musk's more than firm tone is an effort to pre-emptively drive away workers from Tesla before a significant hit via a slumping economy.

"It is always better to introduce austerity measures in good times than in bad times. I see the statements as a forewarning and a precautionary measure," analyst Frank Schwope told Reuters.

Tesla shares have slumped nearly 30 percent in the last six months and slid nearly 20 percent in the last month alone. During that time, Musk has announced shifting political affiliations, announced he would buy Twitter, changed views on buying Twitter, and intimated that LGBTQ was a "personal choice." June is Pride Month.

On Friday morning, Musk endorsed one-time Republican and now Democratic primary challenger Rick Caruso for Los Angeles' mayoral race. Caruso is the son of Dollar Rent A Car founder, Henry Caruso.

Jeffrey Osborne, an investment analyst for Cowen, advised Friday that investors may be growing tired of Musk's antics.

"These distractions are hindering media coverage of Elon and Tesla by extension, which we see as a problem for a company who does not advertise," Investing.com reported. Cowen reportedly has taken a "pause from recommending" shares in Tesla as a result.

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