Tesla is set to lay off 2,688 employees at its Giga Texas factory as part of a broader effort to reduce its workforce due to falling sales and an ongoing price war in the industry.
The company issued a Worker Adjustment and Retraining Notification (WARN) notice on Monday, adhering to U.S. labor laws that mandate a 60-day notice for mass layoffs or plant closures for companies with over 100 employees, reports Reuters.
This move is part of a larger global reduction strategy that includes the termination of 285 positions at its Buffalo, New York facility. The layoffs, which are set to commence on June 14, represent more than 10% of Tesla’s workforce, reflecting significant cuts across its operations.
Further extending its job cuts, Tesla also plans to reduce about 400 jobs at its Giga Berlin factory in Germany, which constitutes roughly 3% of the plant’s workforce. The company expressed a preference for achieving these reductions through a voluntary program, aiming to minimize the impact on its staff, says a separate Reuters report.
Joerg Steinbach, economy minister of the German state of Brandenburg where the Gruenheide factory is located, commented on the layoffs, noting that while the job cuts are regrettable, they are “comparatively moderate” and will be implemented with consideration.
Tesla’s Gruenheide site, which employs over 12,000 employees, will also see around 300 temporary workers let go as part of the global job reduction plan. The company emphasized its goal to maintain as efficient production operations as possible.
The news comes as Tesla recently announced it was cutting over 10% of its global workforce, in what it says is to prepare itself for the next stages of growth, according to CEO Elon Musk.
Today, Tesla released its Q1 2024 earnings and saw $21.3 billion in revenues, down 9% year-over-year, while seeing its net income down as well to $1.1 billion GAAP.