Amid Production Headaches, Tesla Lays Off Hundreds: Report

Tesla employees jockeying for scarce parking spaces outside the company’s Fremont, California assembly plant and Palo Alto headquarters could soon find it easier to locate a spot.

The electric automaker reportedly laid off hundreds of workers this week — a move that comes at an particularly stressful time for the company and its employees. At just 260 units, third-quarter production of the long-awaited Model 3 sedan fell far short of predictions, with CEO Elon Musk blaming production bottlenecks for the slow trickle of highly sought-after vehicles.

Meanwhile, the exact nature of the fired employees is the subject of some debate.

The Mercury News first reported the layoffs late Friday. “Multiple” former and current employees tell the publication the laid-off workers include “trained engineers working on vehicle design and production, a supervisor and factory employees.”

Those same workers estimate the number of layoffs at 400 to 700 employees over the past week, with many allegedly told with no warning. The company’s assembly plant employs roughly 10,000. Tesla, meanwhile, won’t cop to the number of layoffs (and doesn’t call the dismissals “layoffs”), telling the publication the departures came after a routine performance review.

“As with any company, especially one of over 33,000 employees, performance reviews also occasionally result in employee departures,” a Tesla spokesperson told The Mercury News. The spokesperson claims the layoffs weren’t from the manufacturing realm — rather, marketing and sales divisions took the brunt of it.

This statement diverges quite a bit from the workers’ observations. One employee, Juan Maldonado, who was let go after four years with the company, claims that about 60 employees from his area of the factory also got their goodbye notice. Another employee told Reuters Tesla fired him, even though he’s never had a bad review.

“It’s about 400 people ranging from associates to team leaders to supervisors,” the former worker said of the laid-off employees. “We don’t know how high up it went.”

Occurring in the background of the departures is the “production hell” Musk promised his employees. By all accounts, they got exactly that. Earlier this month, a report arose of workers hand-building Model 3 components on the factory floor — as late as early September — as the automated production line remained idle. Musk’s stated production goal for the end of the year is 5,000 vehicles per week, ramping up to a seemingly impossible 10,000 units/week in 2018.

[Image: Tesla]