Elon Musk sent Tesla employees a memo on Sunday announcing that the EV maker would be laying off more than 10% of its workforce globally.
The internal email was sent close to midnight PT, per a timestamp seen by Business Insider.
In the memo, obtained by BI, the Tesla CEO said that there has been a "duplication of roles and job functions in certain areas" as the company has grown rapidly.
On Sunday night, workers who were impacted by the layoffs received an email to their personal accounts, informing them their roles had been eliminated.
"Effective now, you will not need to perform any further work and therefore will no longer have access to Tesla systems and physical locations," the email read.
Tesla's share price was down by 1.2% in premarket trading on Monday on the back of the job cuts news.
Over the weekend, Tesla workers had speculated that layoffs were on the horizon, as rumors that some managers had been told to provide upper management with a list of names spread throughout the company.
Separately, Tesla started instructing managers in February to identify which roles at the company were business-critical and had temporarily delayed performance reviews.
It's the company's first large-scale layoffs since it laid off some workers at its plant in Buffalo, New York, in February 2023.
At the time, the Workers United union said in a complaint filed with the National Labor Relations Board that Tesla unlawfully laid off some of the staff and that the workers were terminated possibly "in retaliation for union activity and to discourage union activity." Tesla denied this and said the employees were laid off due to poor performance.
The job cuts come as Tesla is grappling with slower demand for its EVs and its stock is down over 31% year-to-date. The company will post its next earnings report on April 23.
Read the full memo Elon Musk sent Tesla employees below:
Over the years, we have grown rapidly with multiple factories scaling around the globe. With this rapid growth there has been duplication of roles and job functions in certain areas. 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.
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. This will enable us to be lean, innovative and hungry for the next growth phase cycle.
I would like to thank everyone who is departing Tesla for their hard work over the years. I'm deeply grateful for your many contributions to our mission and we wish you well in your future opportunities. It is very difficult to say goodbye.
For those remaining, I would like to thank you in advance for the difficult job that remains ahead. We are developing some of the most revolutionary technologies in auto, energy and artificial intelligence. As we prepare the company for the next phase of growth, your resolve will make a huge difference in getting us there.
Thanks,
Elon
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