Tesla Executive Rich Otto Resigns, Takes Swipe at Elon Musk Saying Series of Layoffs ‘Hurt Morale’

By Madz Dizon

May 10, 2024 10:07 AM EDT

Tesla Executive Rich Otto Resigns, Takes Swipe at Elon Musk Saying Series of Layoffs ‘Hurt Morale’
A photograph taken on October 27, 2023 shows a view of the electric car company Tesla's Service Center in Segeltorp, south of Stockholm, where workers strike for the signing of a collective agreement.
(Photo : JESSICA GOW/TT/TT NEWS AGENCY/AFP via Getty Images)

In the ongoing Tesla layoff saga, a long-time manager has decided to part ways with the company after dedicating seven years of his career to it.

Rich Otto recently resigned from the electric vehicle manufacturer led by Elon Musk.

Resigned Executive Says Tesla Layoss Hit 'Morale'

In his departure, he expressed his concerns about the significant layoffs that were announced by Musk a few weeks ago, stating that they have had a negative impact on the company and its morale. 

According to MarketWatch, the series of layoffs began in mid-April when Tesla made the decision to reduce its global workforce by "more than 10%." 

Based on his profile, Otto has collaborated with various teams at Tesla, including vehicle engineering, creative, and content, to successfully launch products.

In addition to his other roles, he was responsible for overseeing the organization and execution of the November 2023 Cybertruck delivery event. In 2017, he joined Tesla's communications team.

On Thursday, Tesla stock experienced a 1.6% decline, settling at $172.07. In contrast, the S&P 500 saw a 0.5% increase, and the Nasdaq Composite gained 0.3%.

The recent layoffs have caused concern among investors regarding the company's growth and the potential consequences of losing valuable talent.

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Elon Musk's Tesla Layoff Saga

Musk discussed the job cuts during Tesla's first-quarter earnings conference call, emphasizing their importance in maintaining the company's health following a period of rapid expansion, according to Barrons.

Following the initial announcement, numerous entire teams have reportedly been let go, often for seemingly trivial reasons.

Tesla's entire ad team was disbanded shortly after its formation due to CEO Elon Musk's dissatisfaction with the generic nature of the advertisements.

Tesla's supercharging team faced the consequences of Musk's dissatisfaction when the team's leader, Rebecca Tinucci, failed to meet his expectations for cost reductions. As a result, Musk made the decision to disband the entire team, despite its previous success within the company.

Earlier this week, Tesla made the decision to lay off a number of workers in software and service. This move comes as a surprise, considering that service is an essential department that needs to expand as more Tesla vehicles are on the road and as they continue to age.

Not only have there been layoffs among regular employees, but also among several top executives. This has led some observers to speculate that Musk is attempting to distance himself at the highest level.

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