Tesla has reportedly tasked its managers with identifying “critical” members within their respective teams, according to sources familiar with the matter who requested anonymity due to the sensitive nature of the information. This directive was issued following the cancellation of some employees' biannual performance reviews.
The request, described as a binary assessment, has led to speculation that the electric vehicle maker might be gearing up for a round of layoffs. Tesla has a history of periodic workforce reductions, often attributed to streamlining operations amid fluctuations in demand and company growth.
Despite significant headcount expansion in previous years, Tesla's recent hiring trends have shown a notable slowdown. In 2022, the company added 29,000 employees, compared to a more modest increase of 12,000 in 2023.
Reports suggest that morale within Tesla ranks may be under strain, as evidenced by recent decisions regarding compensation. Last year, salaried employees were informed that their customary stock compensation would not be forthcoming following annual reviews. Additionally, concerns have been raised by workers regarding the adequacy of their annual pay increases, prompting Tesla to promise a reevaluation of compensation, albeit with some delays.
The move to identify key personnel comes amid ongoing efforts by Tesla to rein in costs and maintain competitiveness in the electric vehicle market. Price adjustments have been a consistent strategy for the company to sustain consumer demand for its products.
Tesla has yet to officially comment on the reported directive to managers or the speculation surrounding potential layoffs, leaving the situation subject to further developments.