Tesla’s office in San Mateo, California is closed as part of accelerating cost-cutting. The changes are because nearly 200 employees were laid off who were working in the Autopilot driver-assistance system. Also, most of the laid-off people are known to be hourly workers.
It was revealed that Tesla CEO Elon Musk stated a “super bad feeling” about the economy to his top managers. He stated that the company will be laying off staff by 10%. Professor of electrical and computer engineering at Carnegie Mellon University, Raj Kumar said, “Tesla clearly is in a major cost-cutting mode. This (staff reduction) likely indicates that 2Q 2022 has been pretty rough on the company due to the shutdown in Shanghai, raw material costs, and supply chain problems.”
The pandemic measures in Shanghai led to a drastic decrease in production numbers for Tesla. Despite having taken various measures, the factory is one of the important ones for Tesla’s overall production. The laid-off person, according to Reuters, said that they were told they will be moved to an office in Palo Alto. It will be after the San Mateo lease expires. The laying-off process happened on Tuesday.
Laying off employees
“It was definitely kind of numbing,” the person who was let go said. “Yeah, we’re definitely shocked; we’re definitely blindsided.” Some workers expected Tesla to shift some of the jobs to lower-wage workers in Buffalo, New York, to save costs. Many people in Tesla’s San Mateo office work on data annotation – reviewing and labeling various visuals collected from Tesla vehicles to teach the cars’ Autopilot system how to handle certain kinds of road scenarios. A number of Tesla data annotation employees said on Linkedin on Tuesday that they had been laid off. “So kind of a disappointing day today. Myself along with almost the whole San Mateo Branch at Tesla just got laid off,” Caeser Rosas, a data annotation specialist, said on a Linkedin post. Musk has also said Tesla’s new factories in Texas and Berlin are “gigantic money furnaces” losing billions of dollars.
“Both Berlin and Austin factories are gigantic money furnaces right now. Okay? It’s really like a giant roaring sound, which is the sound of money on fire,” Musk said in an interview with Tesla Owners of Silicon Valley, an official Tesla-recognized club, in Austin, Texas. Musk said Tesla’s Texas factory produces a “tiny” number of cars because of challenges in boosting production of its new “4680” batteries and as tools to make its conventional 2170 batteries are “stuck in port in China.”