200 Employees Are Reportedly Laid Off by Tesla, Closing Its San Mateo Office
Elon Musk, the CEO of Tesla (TSLA), forewarned of impending layoffs, and according to recent reports, one significant division has recently experienced them.
According to Bloomberg News, which relied on insiders with knowledge of the situation, Tesla’s San Mateo, California office has let go of about 200 employees. The Autopilot team is located in that office, among many other things, they carried out “data-labeling” tasks, which involved labeling visual collected data by the Autopilot as well as full-self driving (FSD) driver assistance programmes.
The automaker informed its San Mateo staff members yesterday that the place of work would be closing and that all staff members there would be laid off, according to the electric vehicle (EV) blog electrek, which also claims that LinkedIn is swamped with posts from now-former Tesla employees who worked at that location. Data annotation specialists, who’ve been hourly-paid staff members rather than full-time workers, made up the majority of the affected individuals.
This action is unexpected given that Musk had just recently stated that the business will be laying off 10% of its salaried staff members and that it intended to eventually employ more hourly employees or contractors. In recent weeks, Musk had voiced alarm about the economic situation, saying he had a “super bad feeling” about it when he announced that Tesla would have to reduce 10% of its workforce.
With the 2nd quarter coming to an end, Tesla’s cost-cutting initiatives come as the corporation, along with other car manufacturers, deals with chip shortages and supply disruptions, which have led to manufacturing stagnation and postponed vehicle shipments.
The new Tesla factories in Austin, Texas, and Berlin, Germany, according to Musk last week, are “gigantic money furnaces” that are consuming billions of dollars. The firm’s plans to reduce costs are thus comprehensible, and it faces ongoing pressure to continue being profitable.
Based on inflation that is raising the costs of raw materials, Tesla raised prices early last month by about 5%. Since March, Tesla’s prices have increased for the 3rd time.
The firings within the Autopilot team also happen at an odd moment for Tesla, which is under increasing regulatory scrutiny due to car accidents that happened while Tesla drivers were using Autopilot. The National Highway Transportation Safety Administration (NHTSA) increased its investigation into a sequence of accidents in which Tesla vehicles utilizing Autopilot collided with emergency vehicles that managed to stop on the side of the road or on roadways earlier in the month. The investigation was decided to expand to include 6 additional accidents that were thought to warrant further investigation in addition to the initial 11 crashes.
Around 830,000 Tesla vehicles may need to have the Tesla Autopilot software recalled as a result of the NHTSA investigation. Wednesday at midday, the price of Tesla is down about 3%.