Tesla will lay off more than 10% of its workers

Tesla plans to lay off more than 10% of its workforce in an effort to cut costs, Elon Musk, the automaker's chief executive, told employees on Monday. The job cuts, which amount to around 14,000 people, come as the company faces growing competition and declining sales.

“As we prepare the company for the next phase of growth, it is extremely important to examine every aspect of the company to reduce costs and increase productivity,” Musk told employees in an email, a copy of which was reviewed from The New York Times.

“There is nothing I hate more, but it has to be done,” he wrote.

The email was previously reported by Electrek, an online news site, and Handelsblatt, a German business newspaper.

The move is the latest sign that Tesla may not be as unstoppable as it once seemed. The company's sales are no longer growing at a rapid pace and it has been slow to introduce new models. Automakers in Asia and Europe have flooded the market with electric cars.

Musk's many other initiatives and his propensity to make polarizing political statements have raised questions about how focused he remains on running Tesla. Wall Street is increasingly worried about the company: Tesla's share price has lost about a third of its value this year.

This month, Tesla reported a sales decline that caught investors by surprise. The company said it delivered 387,000 cars worldwide in the first quarter, down 8.5% from a year earlier. It's the first time Tesla's quarterly sales have fallen on a year-over-year basis since the pandemic began in 2020.

The company significantly cut prices throughout 2023 to increase demand, which reduced the profit Tesla makes on each car. But this strategy seems to be losing its effectiveness.

Rivals such as BYD in China, BMW in Germany and Kia and Hyundai in South Korea reported increases in EV sales over the same period, suggesting that slowing overall demand for battery-powered models was not the only explanation for the supply problems. Tesla.

Many of Tesla's workers work at four large auto factories in Fremont, California, Austin, Texas, Shanghai or near Berlin.

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