Tesla Stock Slips 3% on Report It Will Cut 10% Staff and Pause Hiring, Analyst Expects EV Maker to ‘Ramp Back Up’ in 2023
2022.06.03 12:57
Tesla (TSLA) Stock Slips 3% on Report It Will Cut 10% Staff and Pause Hiring, Analyst Expects EV Maker to ‘Ramp Back Up’ in 2023
By Senad Karaahmetovic
Elon Musk told employees he wants to cut 10% of staff at Tesla (NASDAQ:TSLA) and pause hiring, saying he feels very concerned about the state of the economy.
Shares of the company are down 3% in pre-open Friday.
In his e-mail to executives sent Thursday, the billionaire said he had a “super bad feeling” about the economy and announced his plan to cut a part of his workforce.
The e-mail, titled “Pause all hiring worldwide,” came just two days after Musk told his employees to return to the office or leave the company.
Wedbush analyst Daniel Ives believes Tesla is “trying to be ahead of a slower delivery ramp this year and preserve margins ahead of economic slowdown,” he wrote on Twitter.
“Street knows soft deliveries for June Q already on horizon due to China issues/cutting costs prudent now,” he added.
Ives also expects that Tesla will “ramp back up” in 2023.
“Everyone at Tesla is required to spend a minimum of 40 hours in the office per week,” Musk wrote in the previous email. “If you don’t show up, we will assume you have resigned.”
Not long after the announcement, Musk also engaged in a Twitter debate with the Atlassian (NASDAQ:TEAM) co-founder Scott Farquhar, who slammed the Tesla boss over his ‘return to office’ ultimatum and encouraged Tesla workers to explore other remote work positions.
In his response to Farquhar, Musk wrote that “recessions serve a vital economic cleansing function.”
Meanwhile, Musk also postponed the Tesla AI Day to September 30 “as we may have an Optimus prototype working by then,” he wrote in a tweet. The postponement came just two weeks after Musk announced the initial date of August 19.
Optimus is a humanoid robot that Tesla has said it was working on which can allegedly tackle global labor shortages and carry items around an assembly plant for a short term.
