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According to Reuters, Tesla has closed its office in San Mateo, California, and laid off approximately 200 staff working on its Autopilot driver-assist system there, in a move seen as advancing cost-cutting. According to that person, the majority of those laid off were hourly workers.
Tesla CEO Elon Musk told top executives earlier this month that he had a “super bad feeling” about the financial system and that the electric vehicle manufacturer needed to cut staff by about 10%.
Later, the billionaire stated that the 10% cut would only apply to salaried employees and that hourly staffing levels would continue to grow.
“Tesla clearly is in a major expense mode,” said Raj Rajkumar, a Carnegie Mellon University professor of electronics and communication. “This (staff reduction) likely indicates that the company had a rough 2Q 2022 due to the Shanghai shutdown, cost of materials, and supply chain issues.”
Shanghai’s anti-pandemic measures have reduced Tesla’s output there.
Employees at the satellite office had earlier been told that they would be relocated to a Palo Alto office in stages beginning this month, according to the laid-off employee who spoke to Reuters. However, the majority of the employees were laid off on Tuesday.
“It was definitely numbing,” he admitted. “Yeah, we’re definitely surprised; we’re definitely taken aback.”
Some employees expected Tesla to shift some jobs to lower-wage workers in Buffalo, New York, in order to save money.
Tesla did not respond to requests for comment for comment from Reuters.
Many people in Tesla’s San Mateo administrative work on data annotation, which involves reviewing and labelling various visuals collected from Tesla vehicles in order to teach the cars’ Autopilot systems how to handle different types of road scenarios.
On Tuesday, a number of Tesla annotation employees announced their layoffs on LinkedIn.
“Today has been a bit of a letdown. Myself and nearly the entire San Mateo Branch of Tesla were recently laid off “Caeser Rosas, a data annotation expert, stated on Linkedin.
The job cuts in San Mateo were first reported by Bloomberg.
Tesla’s new factories in Texas and Berlin, according to Musk, are “gigantic money furnaces” that are losing billions of dollars.
