Tesla Cuts Jobs in Software and Service Teams, Electrek Discloses


According to tech publication Electrek’s report on Monday, electric-vehicle manufacturer Tesla (NASDAQ:TSLA) has initiated layoffs affecting employees in its software, service, and engineering departments.

This decision follows Tesla’s recent dissolution of its electric vehicle charging department, part of its broader strategy to reduce its global workforce by over 10%. Employees reportedly received emails over the weekend informing them of the layoffs.

Tesla’s shares were up more than 1% at the time of the report, but the company did not immediately respond to Reuters’ request for comment.

Last month, Tesla disclosed plans to lay off more than 6,700 employees across its locations in Texas, California, Nevada, and New York. The company has faced challenges due to declining sales and increased competition among automakers, aggravated by higher interest rates dampening the adoption of electric vehicles.

To realign its focus, Tesla aims to prioritize autonomous driving software, robotaxis, and its humanoid robot Optimus. Analysts suggest that CEO Elon Musk may be reducing spending on certain teams to allocate resources for these projects.

Tesla anticipates incurring more than $350 million in costs related to the layoffs during the second quarter. Notably, the job cuts included several top executives such as Drew Baglino, Rohan Patel, Rebecca Tinucci, and Daniel Ho.

In April, Tesla announced plans to develop “new models” utilizing its existing platforms and production lines, aiming to enhance control over capital expenditures amidst its strategic realignment.

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