Tesla chief Elon Musk has finally responded after media outlets around the world on Monday reported that the company plans to lay off 10% of its workforce and two key executives have already left the automaker.
According to Teslarati, Musk, 52, explained that Tesla has to "reorganise and streamline the company for the next phase of growth" every five years.
“As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” Musk stated in an email to employees.
“As part of this effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally. There is nothing I hate more, but it must be done,” he continued.
Later, senior vice president of Powertrain Drew Baglino and vice president of Public Policy and Business Development Rohan Patel announced their departures from Tesla.
As competition heats up and it becomes increasingly evident that it must modernise its product line, Tesla has been getting ready to launch into a new stage of growth for its automotive division.
While the Cybertruck was delivered less than six months ago and the Model 3 was recently updated, Tesla is getting ready to introduce a new next-generation vehicle platform that will allow it to enter a new growth cycle.
The company is set to launch its next-generation platform featuring the Robotaxi and rumoured $25,000 vehicle in the second half of 2025.
However, the company has warned investors of lower growth rates in 2024 and early 2025 due to the focus on the new platform.
