Tesla To Cut Workforce By 7 Percent; Elon Musk Warns 'Road Ahead Is Very Difficult'
PALO ALTO, Calif. (CBSLA/AP) - Electric car and solar panel maker Tesla says it plans to cut its staff by about 7 percent, or roughly 3,000 jobs.
An email from CEO Elon Musk to employees released early Friday said the "road ahead is very difficult."
The memo posted on the company's website said despite facing industry headwinds, Tesla Inc. hopes to post a "tiny profit" in the current quarter.
It said Tesla increased its staff by 30 percent last year but cannot support that size of staff.
"Tesla will need to make these cuts while increasing the Model 3 production rate and making many manufacturing engineering improvements in the coming months", Musk wrote.
Tesla's shares tumbled earlier this month after it cut vehicle prices by $2,000 and announced fourth-quarter sales figures that fell short of Wall Street estimates.
The company has been beset by various PR gaffes and reported manufacturing issues, including Model S key fobs vulnerable to hackers and an SEC fraud suit that led to Musk stepping down as the board chair.
(© Copyright 2019 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)