Hundreds of Tesla Employees Fired

Published on: 16 Oct, 2017

Tesla Inc (NASDAQ: TSLA) Model 3 electric car is off to a rocky start, it seems, with the company having to fire hundreds of employees recently. It appears that the manufacturing of the Model 3 is not going on at the pace that would be desirable. The company had around 33,000 employees at last count but after the firing, it is not clear exactly how many are left with Tesla.

Tesla has been trying to expand its production of the Model 3 at a rapid clip lately. Elon Musk had announced that his company would be ready to turn out 5000 automobiles a week by the time 2017 draws to a  close. However, this does not seem to be a possibility at all. There were many challenges faced by the company earlier in the year which has, ostensibly, thrown this scheduling off track.

According to company officials, an annual performance review was conducted recently. The firing has taken place after the results of this review came out. While the sequence of events suggests that underperformers have been asked to go, the company has not released any official statement to this effect so far. It is believed that no one cadre of employees has been targeted. Instead, managers, sales staff, engineers, and factory staff have all faced dismissals. There have been rumors of manufacturing problems plaguing the production lines, but again, there is no confirmation that the dismissals were linked to these issues.

Earlier this month, CEO Elon Musk did admit that the company was having to work through some 'bottlenecks'. In fact, the announcement of an electric semi truck that was to be made was pushed by some three weeks. It is thought that this was part of the move to divert resources to resolve problems plaguing the Model 3 production lines.  According to the official word, the reason for glitches in production timing is that some of its 'manufacturing subsystems' have not been activated on time, as per schedule.

It remains to be seen whether Tesla will meet its production expectations by the end of the year. While it may be able to do so even now, there is also a question whether the company can manage without any further reduction in its workforce or any other drastic moves coming in from the management.

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Danny Abramov

Email: danny@financialinsiders.com

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