Musk backs down on Tesla cuts, says headcount will increase

Tesla Chief Executive Elon Musk said on Saturday that the electric vehicle maker’s total number of employees will increase over the next 12 months, but the number of salaried employees is expected to be little changed, backtracking in an email. just two days ago, saying 10% job cuts were needed.

“Total headcount will increase, but salaried workers should be pretty steady,” Musk tweeted in response to an unverified Twitter account that made a “prediction” that Tesla headcount would increase over the next 12 months.

Total headcount will increase, but salary should be fairly flat

— Elon Musk (@elonmusk) June 4, 2022

Musk, in an email to Tesla executives on Thursday that was seen by Reuters on Friday, said he had a “super gut feeling” about the US economy and needed to cut jobs by about 10%.

In another email to employees on Friday, Musk said Tesla would reduce the number of salaried employees by 10% as it has become “overstaffed in many areas”. But “the number of hourly employees will increase,” he said.

Tesla shares fell 9.2% on Friday on the news.

According to a US regulatory filing by Tesla, the company and its subsidiaries had nearly 100,000 employees at the end of 2021.

Ahead of his emails about staffing levels, Musk on Wednesday, in an email to Tesla employees, issued an ultimatum to return to the office for a minimum of 40 hours a week. Failure to do so would be considered a waiver, he wrote.

Musk said on Thursday that Tesla’s AI day has been pushed back to September 30 and said a prototype of Optimus, a humanoid robot that is a priority for the company, could be ready by then and could be launched next year. year .