Tesla Job Cuts Feared After Elon Musk's Firm Asks Managers Which Roles Are Most Important

By Jace Dela Cruz

Feb 08, 2024 04:32 AM EST

Speculation about potential layoffs at Tesla has surfaced following a report that the electric vehicle maker instructed managers to identify critical roles on their team. 

(Photo : FREDERIC J. BROWN/AFP via Getty Images)
Tesla CEO Elon Musk speaks during the unveiling of the new Tesla Model Y in Hawthorne, California on March 14, 2019.

Performance Evaluations of Tesla Employees

Citing people familiar with the matter, Bloomberg reported that Tesla sent out a single-line email to US managers, asking them to make a binary assessment of their deputies' roles. 

According to Business Insider, it comes after Tesla canceled several employee performance reviews. Four employees told the outlet that Tesla conducts performance evaluations twice a year, but only salaried workers are eligible for promotions or bonuses once a year. 

Tesla rates employees on a scale of one to five. However, the company's representatives have yet to comment on the matter.

READ NEXT: Elon Musk's Tesla Sued by 25 California Counties Over Hazardous Waste 

Is Tesla Slowing Down in Hiring?

Tesla CEO Elon Musk has a track record for implementing cost-cutting measures across his companies. In 2022, he cut Twitter's workforce in half after he bought the company.

Before the layoffs in the social media firm, Musk requested team leaders to make lists of top-performing employees based on performance and code reviews. Last year, the tech billionaire told Tesla staff that he must approve all new hires, a sign that the company may be slowing down its hiring. 

During Tesla's earnings call last month, Musk warned about a sales slowdown this year, and said that employees would be working extensively to ramp production for the automaker's next-gen vehicle platform.

Tesla's stock has dropped around 21 percent in the last month as it faces increased competition from Chinese automakers.

READ MORE: Elon Musk Could Lose His Spot as World's Richest Person After Judge Voids His Record-Breaking $55B Tesla Pay Package

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