Nearly 3,000 Tesla workers in Fremont, Palo Alto to be laid off in June
Documents filed by Tesla with the state of California show nearly 3,000 workers in Fremont and Palo Alto will be among the mass layoffs announced by the electric automaker earlier this month.
Tesla told the state Employment Development Department that 2,267 workers at Tesla's Fremont factory and other Fremont locations would lose their jobs, while another 486 workers at several Palo Alto sites would also be laid off.
The Worker Adjustment and Retraining Notification (WARN) notices filed also show that another 515 workers will be laid off at Testa facilities in the San Joaquin County city of Lathrop and 64 people will lose their jobs in Burbank.
In a leaked memo to Tesla staff last week, CEO Elon Musk said the company "made the difficult decision to reduce our headcount by more than 10% globally." Word of the leaked memo was first reported by the electric vehicle website Electrek.
"There is nothing I hate more, but it must be done," Musk wrote in the memo. "This will enable us to be lean, innovative and hungry for the next growth phase cycle."
As of December 2023, Tesla had more than 140,000 employees, which means at least 14,000 could be out of a job by the end of this year.
On Tuesday, Tesla also announced plans to lay off nearly 2,700 workers at its factory in Austin, Texas. The layoffs in California and Texas were scheduled to begin on June 14.
The news of the Austin layoffs came on the same day the automaker's earnings report showed first-quarter profit plummeted 55% to $1.13 billion, compared to $2.51 billion from January to March last year. Tesla blames the slump partly on EV sales being "under pressure as many carmakers prioritize hybrids over EVs." Company execs also said phasing in an updated version of the Model 3 sedan at its Fremont factory and plant shutdowns due to shipping diversions in the Red Sea also played a role in the weak earnings.
Earlier this month, Tesla reported a sharp drop in first-quarter sales as the EV market competition increased worldwide and the price cuts the company enacted months ago failed to entice more buyers
In another black eye for the company, Tesla said on April 19 that it was recalling nearly 4,000 Cybertrucks because of a faulty accelerator pedal.
Despite the spate of bad news, Tesla announced during its earnings call it plans to launch new, more affordable vehicle models in the second half of 2025. Investors cheered the announcement and shares of Tesla jumped 12% on Wednesday on the NASDAQ.
Associated Press contributed to this report.