Business

Elon Musk said Tesla is cutting 3.5% of its total workforce because it's targeting salaried workers

Business Insider US
Tesla CEO Elon Musk.
  • Tesla is in the process of laying off 10% of salaried staff.
  • CEO Elon Musk said that means it's cutting around 3% to 3.5% of its total workforce.
  • Musk's messaging around the cuts has been confusing at times.
  • For more stories visit Business Insider.

Elon Musk put a more exact figure on how many of its workers it plans to cut during an interview on Tuesday.

Tesla has started laying off staff in recent weeks, and Musk's messaging on how the company is carrying out the cuts has been confusing.

Musk told Tesla executives in an email obtained by Reuters earlier this month he wanted to pause hiring worldwide and cut 10% of the company's workforce due to the fact he had a "super bad feeling" about the economy.

He later seemed to contradict that in a tweet, saying: "Total headcount will increase, but salaried should be fairly flat."

Appearing via video link at the Qatar Economic Forum, Musk was asked to clarify exactly what proportion of Tesla's total workforce he expects to lay off.

"Tesla is reducing the salaried workforce roughly 10% over the next probably three months or so," Musk said. 

"We expect to grow our hourly workforce," he added.

"We grew very fast on the salaried side and we grew a little too fast in some areas, and so it requires a reduction," he said.

Musk said Tesla's workers are split roughly 66% hourly workers and 33% salaried.

"I guess technically a 10% reduction in the salaried workforce is only roughly a 3% to 3.5% reduction in total headcount," Musk said.

Musk also reacted to a lawsuit which has been filed by two former Tesla employees who were terminated this month.

The former employees said they were part of a layoff of around 500 workers in Nevada, and accused Tesla of breaking the law by laying off hundreds of employees on short notice. The pair say this violated the Worker Adjustment and Retraining Notification Act.

Musk called the suit "pre-emptive," "trivial," and said it had "no standing."

"That is a small lawsuit that has no consequence," Musk added.


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