Tesla culling 9% of staff as it chases profits

14 June, 2018, 08:32 | Author: Eric Barnett
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The move, seen by many as a strategic manoeuvre by Mr Musk to show his optimism over Tesla's future, prompted shares to push higher in after-hours trading.

Business magnate, investor, engineer, eccentric billionaire, Tesla (TSLA) co-founder and CEO, Elon Musk, purchased upwards of 70,000 shares of the company, simultaneous with his announcement of layoffs of nearly 10% of employees. "Tesla has grown and evolved rapidly over the past several years, which has resulted in some duplication of roles and some job functions that, while they made sense in the past, are hard to justify today", the email reads. The company did not say how much money the cuts would save.

Tesla CEO Elon Musk bought 72,500 shares of his company this week, according to Security and Exchange Commission filings.

Musk said that the job cuts are part of Tesla's restructuring process.

Several Wall Street analysts anticipate a capital raise this year despite Musk's statements that it will not be necessary due to profitability and positive cash flow in the third or fourth quarters.


SpaceX founder Elon Musk smiles at a press conference following the first launch of a SpaceX Falcon Heavy rocket at the Kennedy Space Center in Cape Canaveral, Florida, U.S., February 6, 2018.

The report comes amidst other significant news becoming public, that the company is laying off almost 10% of its workforce.

Also of note is that Musk has a somewhat unconventional pay package at Tesla, where he'll be granted additional stock options as the company hits key milestones. A majority of Tesla employees working at Home Depot will get offers to work in Tesla's own stores.

He wrote that reaching Musk's Model 3 production goal of 5,000 vehicles per week by the end of June is still the primary driver of profitability.

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