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Tesla cuts 9 percent of workforce; Musk says 'necessary reorg'

Tesla cuts 9 percent of workforce; Musk says 'necessary reorg'

by Justin King

The cuts were nearly entirely focused on salaried employees, with no production workers affected.

Tesla has decided to slash nine percent of its workforce to streamline operations and achieve profitability.

"Difficult, but necessary Tesla reorg underway," CEO Elon Musk wrote on Twitter.

In an email to employees, the executive noted that Tesla has rapidly grown over the past several years and some job positions are either duplicate or "difficult to justify" today.

"As part of this effort, and the need to reduce costs and become profitable, we have made the difficult decision to let go of approximately 9% of our colleagues across the company," he wrote.

The cuts are said to be nearly entirely focused on salaried positions, with no production workers affected. The clarification is presumably aimed at assuaging fears that Model 3 production ramp could be negatively affected by an attempt to achieve near-term profitability.

"To be clear, Tesla will still continue to hire outstanding talent in critical roles as we move forward and there is still a significant need for additional production personnel," Musk added. "I also want to emphasize that we are making this hard decision now so that we never have to do this again."

The move follows a recent purge of contractor presence at the company. Musk essentially threatened to lock out any contractors that did not have a Tesla employee to vouch for their necessity.

Difficult, but necessary Tesla reorg underway. My email to the company has already leaked to media. Here it is unfiltered: pic.twitter.com/4LToWoxScx

— Elon Musk (@elonmusk) June 12, 2018