24 ms·

Tesla to Cut 10% of Jobs

430 points by ra7 4y ago

deleted 4y ago
[deleted]
draw_down 4y ago
jleyank 4y ago
Make that popcorn. Elon’s going to try and dodge all those laws and rules about layoffs, severance, etc. The only thing he might end up hiring is lawyers.
- toomuchtodo 4y ago
  Musk’s return to office directive is likely a mechanism to force quits and avoid the WARN act and paying severance to thousands of workers. Edit: If you’re looking for SWEs, I’ve spoken to three at Tesla who are looking for new opportunities. They’re an org to target for talent acquisition.
  - HWR_14 4y ago
    Yeah, his directive seemed obviously aimed at getting people to quit. As I have understand it, legally, that's transparently the same thing. Hence his very public hiring of lawyers whose qualifications are "fighting" to discourage employees from seeking what they are owed.
    - that_guy_iain 4y ago
      I think it's not legally the same thing. Since doing things to get people to quit have to be larger than you need to work at your place of employment. It's moving them across the country, making them work unsocialable hours, etc. Not returning to the office, which the goverment actually wants. Remote work is bad for the economy.
      - Silhouette 4y ago
        Remote work is bad for the economy. I've seen this claim a few times now. Are we actually sure it's true? Or does it just shift long-term spending trends? For example maybe people don't go to lots of inner city coffee bars in business districts any more but local cafes near residential areas are thriving. Maybe people don't stop in big stores on their way home from work but home delivery services are thriving. Maybe bad managers who don't understand how to support and motivate their teams are having problems with people slacking off at home. What if good managers who look after their people and engender a degree of trust and even loyalty are improving their team's performance by making their people's lives better? It seems far too early to draw broad conclusions about the effects of population-scale remote working but early enough to be confident that some people really like it but it's not for everyone and that some types of businesses benefit from the shift away from the office while others lose out.
        ghaff 4y ago
        It's probably bad for cities in general, whether inner city coffee bars or office (and probably residential) real estate. And that may (or may not) be bad for people who want to live in cities. My observation though based just on traffic patterns is that debates about remote work are something of a bubble at this point. When I've had to go into the relatively nearby city a couple times lately rush hour traffic seemed as bad as ever although train/subway seemed relatively light.
        that_guy_iain 4y ago
        > For example maybe people don't go to lots of inner city coffee bars in business districts any more but local cafes near residential areas are thriving. People don't buy coffee on the way to work, people don't buy coffee on the way home, people don't buy sandwiches and snacks, people don't spend money on commuting, people don't spend money at resturants for launch, companies stop having team lunches. People don't go to cafes locally because they have a coffee machine at home. Most people buy coffee and drinks on the way to work out of ease not that they taste better. > Maybe bad managers who don't understand how to support and motivate their teams are having problems with people slacking off at home. What if good managers who look after their people and engender a degree of trust and even loyalty are improving their team's performance by making their people's lives better? This talk of having good and bad managers makes no real sense. Companies aren't just going to fire managers. That would be unfair. > It seems far too early to draw broad conclusions about the effects of population-scale remote working but early enough to be confident that some people really like it but it's not for everyone and that some types of businesses benefit from the shift away from the office while others lose out. Too early? Two-years in?
- rossdavidh 4y ago
  1) you're likely correct, the "return-to-office" was in part a stealth layoff 2) given that this sort of thing is very common during a downturn, I think Tesla's lawyers probably have a well worked out method on how to do it; I'm not saying it's kosher, but it's common. The only reason this gets so much press is that it's Elon Musk.
- deleted 4y ago
  [deleted]
akmittal 4y ago
So this was not enough? https://mobile.twitter.com/BBCWorld/status/1532044561807179779 https://mobile.twitter.com/BBCWorld/status/15320445618071797...
- that_guy_iain 4y ago
  Well, that happened yesterday and is probably part of their process of reducing numbers by 10%. It's better if they quit than if they're laid off.
  - alkonaut 4y ago
    Except if yo lay off 10% you get to cut (at least some of) the 10% you want to get rid off. And if you rely on persuading people to quit by reducing satisfaction, you'll get rid of a large chunk of the 10% best employees instead.
    - that_guy_iain 4y ago
      Not really. The people who will flee because of this will also flee because of layoffs and look for somewhere more secure. And everyone is acting like the best employees are going to be the ones quitting. Nah, the best employees are highly engaged employees not ones that are technically talented but will flee just because they have to go to an office. Your most technically talented employees are often not your best employees nor your most valuable. They're important and expensive, but the person in ops that gets paid a low salary but knows the ins and outs of everything and knows how to troubleshoot everything to the point that stuff is fixed is vital. A software developer who is really smart can and will be replaced. There will be HR people working on retention of top employees as we speak. https://www.mckinsey.com/business-functions/m-and-a/our-insights/talent-retention-and-selection-in-m-and-a https://www.mckinsey.com/business-functions/m-and-a/our-insi... gives an insight into this when it comes to M&As
      - watwut 4y ago
        "Highly engaged employees" do actually leave when management does things like "intentionally trying to alienate and push employees away". People who are highly engaged want to be highly engaged and don't like changes that lowers engagement. Changes designed to alienate employees are alienating highly engaged employees as much as they alienate everyone else. Except that, if you are already alienated, you are used to it. When you used to be engaged, you perceive the change as very negative. Also, have you ever worked in a company affected by consultants like you suggest? They don't have capability to recognize or motivate good people .
that_guy_iain 4y ago
Everyone has a super bad feeling about the economy. I think most large companies are going to be announcing back to office then followed by layoffs.
- xxs 4y ago
  It won't be 2007-2008 bad, but there will be a recession. First lay offs tend to be the R&D.
  - that_guy_iain 4y ago
    I agree I don't think it'll be 2007-2008 bad. I think it'll be worse. Covid, Ukraine, Remote Work, etc are all hammering the economy.
    - itsoktocry 4y ago
      >bad. I think it'll be worse. Different. 2007/08 was a financial crisis, and global banking infrastructure almost imploded. Here we're talking about deglobalization, supply chain issues and, well, a war. What's interesting is that the main problems may not be US focussed, it may happen around the world (although no one will be safe). For example, hard to imagine the Canadian real estate sector isn't going to melt down...
      - myth_drannon 4y ago
        "For example, hard to imagine the Canadian real estate sector isn't going to melt down..." - Oh, how many times did I hear that, but it's wishful thinking. At best it's 20% down
        achenatx 4y ago
        bear in mind that 20% down is often times losing 100% of your capital due to leverage.
cmrdporcupine 4y ago
Uh,ok... Two days ago the "Who is hiring" thread here had something like 20+ software engineering positions for Tesla. https://news.ycombinator.com/item?id=31585021 https://news.ycombinator.com/item?id=31585021 More erratic decision making from Mr Musk. Like, I dunno, the time he told Twitter he was taking Tesla private while tripping on LSD. He needs to step aside from Tesla at this point.
- fibers 4y ago
  The same can be said about Coinbase and look what's happening. Let's just say buyer beware when it comes to meme companies.
  - cmrdporcupine 4y ago
    The thing is, Tesla isn't a Coinbase. Tesla is now a giant manufacturing company that makes a lot of things, brings in revenue, and has some really solid engineering. I don't like their cars from a UX standpoint, but the engineering in their motors and battery packs are solid good products. Move fast and break things might have been fine in the early days. Seems to me like the company needs to 'grow up' and demonstrate responsibility to shareholders and customers, and to do that it likely involves significantly sidelining Musk, who clearly behaves very erratically.
    - Isinlor 4y ago
      The idea of shareholders sidelining Musk is crazy. Shareholders paid him tens of billions to stay after he wanted to step down as CEO after Model 3 push. https://www.theguardian.com/business/2022/apr/21/elon-musk-stands-to-collect-23bn-bonus-as-tesla-surges-ahead https://www.theguardian.com/business/2022/apr/21/elon-musk-s... Elon Musk is golden goose for Tesla shareholders.
      - bitwize 4y ago
        The fact remains that Musk is the techbro Kanye West, and shareholders should sideline him.
GiorgioG 4y ago
Shocking - it was in no way obvious Tesla was trying to trim headcount /s https://news.ycombinator.com/item?id=31580739 https://news.ycombinator.com/item?id=31580739
alkonaut 4y ago
> The message, sent on Thursday and titled “pause all hiring worldwide”, came two days after the billionaire told staff to return to the workplace or leave So people who claimed less than 24h ago it was at lest partially a way of creating cheap layoffs, were proven right pretty swiftly.
- hooande 4y ago
  It's hard to imagine that severance from a 10% layoff is a significant cost for a company of Tesla's size and revenue. It's not small by any means, but not necessarily worth a complicated scheme in relative terms
  - formerkrogemp 4y ago
    I think it's just a game for executives at this point to think of what dumb policy will people put up with to keep their jobs or to quit and reduce severance.
- lapcat 4y ago
  Remember when Marissa Mayer eliminated WFH at Yahoo? Seemed to work out well for them.
  - mjr00 4y ago
    Do you really think Yahoo would have avoided its fate if it had continued allowing WFH? I don't think it was a good decision, but Yahoo had/has way more issues with its business than whether or not it allows employees to WFH.
    - TheBigSalad 4y ago
      No, but it's one of those decisions that most normal people could easily recognize as a bad decision. It clearly didn't have any positive impact on the company and most likely had a negative impact. Just a CEO doing pure nonsense, causing a huge impact to the company based on ego over data. As opposed to making actual positive decisions. There was no reason for yahoo to fail other than a huge series of poor leadership decisions.
ericbarrett 4y ago
A couple of days ago somebody posted this Reddit thread: https://old.reddit.com/r/cscareerquestions/comments/v2lpdw/elon_musk_just_asked_all_employees_to_return_to/ https://old.reddit.com/r/cscareerquestions/comments/v2lpdw/e... "Tesla expanded massively during Covid, as of now half of the dev team(including me) don’t have parking space or desk. It’s physically impossible for everyone to return to office. "Should I ignore the email, or should I drive to the office and sit under the stairs?" Commenters' general feeling was that it was a soft layoff, and some speculated that it might amount to constructive dismissal.
- gamblor956 4y ago
  Commenters' general feeling was that it was a soft layoff, and some speculated that it might amount to constructive dismissal. Another instance of Tesla violating labor laws, this time to get out of paying unemployment....
- that_guy_iain 4y ago
  They can and will buy desks.
  - kenferry 4y ago
    When people say “no desk” what they mean is “no space in the building to allocate a desk”.
    - that_guy_iain 4y ago
      When people say "no space in the building to allocate a desk” they mean "No space to neatly put a desk." Companies have often shown repeatedly they can force desks into rooms when needed. Anyways, they can and will buy office space to put the desks when needed.
      - sillysaurusx 4y ago
        Lol. I can confirm that a motivated company can Tetris a lot more desks into a room than you’d expect. My first job… ah, memories.
raphaelj 4y ago
> Elon Musk feels ‘super bad’ about economy Considering how bad Elon is at making predictions, this is actually great news.
- jes 4y ago
  Can you say more? Musk is the world’s wealthiest individual. I’m having trouble seeing see how being bad at making predictions results in that outcome.
  - manuelabeledo 4y ago
    > Musk is the world’s wealthiest individual. On paper. He bet big on EVs, which the market rewarded. Same happened with Microsoft and computers maybe thirty years ago, main difference being that Tesla is not holding a semi monopoly, and competitors are catching up quickly.
    - rcMgD2BwE72F 4y ago
      >and competitors are catching up quickly. How do you measure that? All sales figures show the contrary. Also, two days ago https://www.bloomberg.com/news/articles/2022-06-01/vw-ceo-says-tesla-moves-at-double-speed-in-changing-industry https://www.bloomberg.com/news/articles/2022-06-01/vw-ceo-sa... >Volkswagen AG said Tesla Inc. is moving twice as quickly as the rest of the industry that needs to pick up the pace in the shift to making electric vehicles packed with software.
      - raphaelj 4y ago
        Tesla sales growth, but slower than the EV market. Tesla is thus loosing market share (in EV) while increasing revenue.
  - raphaelj 4y ago
    Just top of my mind: "Covid will be gone by April 2020": https://twitter.com/elonmusk/status/1240754657263144960 https://twitter.com/elonmusk/status/1240754657263144960 "FSD will be achieved by 2018": https://twitter.com/elonmusk/status/686279251293777920 https://twitter.com/elonmusk/status/686279251293777920 "Neuralink in human brains by 2020": https://news.yahoo.com/everything-know-neuralink-elon-musks-103000152.html https://news.yahoo.com/everything-know-neuralink-elon-musks-... Being wealthy has also a lot to do with being at the right place, at the right time, inherited wealth, and outsourcing efficiently.
drfuchs 4y ago
Anybody care to speculate on the chance that Twitter forces their sale to him, and then TSLA goes down far enough that Musk gets a margin call on the loan he's using to finance the purchase, and he loses everything? Or at least half of everything?
- javajosh 4y ago
  I think it's a very high likelihood. Why? Because Musk is idea-driven and doesn't really care about money, so he is the perfect person to harness with financial and legal obligation, because he will continue to pull no matter what. Sure it's slavery with extra steps, plus so many people hate Musk there's not even a cultural downside!
  - Swenrekcah 4y ago
    Wait a minute.. Are you suggesting it’s slavery to hold a billionaire businessman to his contracts?
    - formerkrogemp 4y ago
      > Sure it's slavery with extra steps, plus so many people hate Musk there's not even a cultural downside! Musk is a slave? Best conspiracy theory I've heard this month.
    - javajosh 4y ago
      I'm just saying his counter-parties have good reason to go for blood, because he's got a lot of it .
  - Marazan 4y ago
    He doesn't care about money which is why he complains about taxes all the time?
  - tyrfing 4y ago
    After you have a binding deal like the one he signed, it's very hard to get out of it. Being forced to complete the deal anyway has precedent, like 2 years ago when LVMH tried to back out of their Tiffany deal due to Covid. https://www.law360.com/articles/1324006/tiffany-lvmh-lower-merger-price-to-15-8b-settle-dispute https://www.law360.com/articles/1324006/tiffany-lvmh-lower-m...
adverbly 4y ago
Let me get this straight: "Work 80 hr weeks! Be just like me!" Musk: becomes worlds richest person Employees: laid off What planet do you live on where you see this as a sustainable, world-improving system for the world and for compensation? Anyone that works 50 hr weeks for this dude is out of their mind.
- dionidium 4y ago
  People should be free to make that decision for themselves. At a low enough resolution basically nobody works at Tesla. It's a big world and there are lots of options.
- sillysaurusx 4y ago
  There’s a more general idea here: don’t work more than you want to, after the amount you’re required to.
- 0daystock 4y ago
  You act like exploitation of employees is exclusive to Tesla, or even the tech industry. The reality is far worse than you can even imagine.
  - lapcat 4y ago
    > You act like exploitation of employees is exclusive to Tesla, or even the tech industry. Where did the OP say or imply that?
    - 0daystock 4y ago
      The part where he complains that an exchange of 50 hours of labor for compensation at the top 5% of the world is somehow unfair or abusive, and is otherwise surprised by the concept of at-will employment.
      - lapcat 4y ago
        > surprised by the concept of at-will employment I seriously doubt the OP was surprised by the concept of at-will employment. What the OP said was "Anyone that works 50 hr weeks for this dude is out of their mind." In other words, they are doing it voluntarily, but it's still a bad idea for them, maybe even delusional. If you've ever had a bad exit from an employer, you start to rethink the sacrifices you made for the employer while you were there.
leroman 4y ago
If people are afraid for their jobs (or more generally about the economy) they are more likely to do what you say.. WFH.. criticism about Twitter.. all things better discussed when economy recovers.. how convenient..
rinze 4y ago
So the message here seems to be "if you want your employees to leave, make them return to the office".
- pwagland 4y ago
  No, I think that the real message is "If your employees don't want to leave, make them return to the office". And then you announce a hiring freeze, and that equals an official downsizing.
- papito 4y ago
  There are a lot of people who are good at looking busy in the office and doing very little. I can come in at 7AM, crush it, and leave at 2PM. Here is the thing, however - the guy who came in at 10:30AM and is sitting at his computer for some reason at 7PM is going to be viewed as the "hard worker". It's all bullshit. If this is what Musk is doing, he is going to shed some of his most productive workers and leave those in place who are just good at fronting.
deleted 4y ago
[deleted]
sys_64738 4y ago
Musk is a narcissistic boss with a moon-sized ego to match.
swamp40 4y ago
I wonder if him coming out as a Republic was a similar tactic as the "return to office" memo? He might be thinking he can get 5% of the people to quit just based on differences in values, making his remaining employees more homogenous and giving them a common culture.
- avrionov 4y ago
  I wonder if him coming out as a Republic was a similar tactic as the "return to office" memo? He came as Republican not as a Republic. Give it a few more years.
rvz 4y ago
Right. Raise your hand if you were surprised to see this happen. So yesterday when it was Coinbase [0] announcing cuts the reaction was, 'ha ha crypto bad', 'worst of luck to them' and now when it also affects companies like Tesla, now the reaction is 'Shocking', 'everyone is doing it now', 'I wouldn't read much into it. A 10% cut is completely normal and healthy for a company the size of Tesla.' This to me sounds like some form of cope that many thought the market was always going up forever. The recent market rally of 2020 had to come to an end. [0] https://news.ycombinator.com/item?id=31600505 https://news.ycombinator.com/item?id=31600505
- vsareto 4y ago
  Quick recession, then back to the market always going up. And for longer time spans, it has always gone up.
  - mschuster91 4y ago
    > And for longer time spans, it has always gone up. Mostly because of utterly insane injections of cash into the economy, whether by unsafe lending practices creating money out of thin air (which ended up causing 2008ff) or by the central banks creating money out of thin air and buying up assets. Now, especially after two years of pandemic-related bailouts, there's no government whose balance sheet hasn't been hit hard... governments can't take up more debt to inject into the economy, and the central banks cannot because inflation is already skyrocketing across the world. Additionally, the people are fed up with social inequality worldwide - they saw that a lot of wealth was redistributed from the bottom to the top stock owners over the last two years. It may very well be that governments shift focus from propping up the stock markets to preventing social unrest, not to mention climate change which is bound to send a lot of companies' worth towards the bottom as their business model becomes outdated (e.g. car manufacturers, oil/gas companies).
    - deleted 4y ago
      [deleted]
  - rvz 4y ago
fnordpiglet 4y ago
Most companies I’ve ever worked at top grade yearly and lay off 5-10% of the workforce as a business practice. The fifth quartile it’s been called. I’m not saying that’s what’s happening here to be clear. But a 10% RIF isn’t unusual.
studmuffin650 4y ago
Interested to see this go down in parallel with Elon's "everyone must be in office decree". I have multiple friends that work at Tesla and at least one of them has it in their work contract to allow remote work for at least a year (they started 2 weeks ago). Not sure how his decree will work out (though I have only heard about the employment contract, not actually seen it).
- erikpukinskis 4y ago
  Unless your friend lives in Montana, their employment is “at-will”. Which means at any time Tesla can change their mind on any aspect of the agreement and offer you a choice between a new contract or the door.
  - ProjectArcturis 4y ago
    Yes, but having that in an offer letter or work contract makes it a lot easier to argue for constructive dismissal.
  - fnordpiglet 4y ago
    That’s not true. At will is almost never an excuse for violating contracts, employment law, or various discrimination protections. That said they can do it, but they would expose themselves to copious lawsuit liability.
    - NovemberWhiskey 4y ago
      Being a contract worker is the alternative to being an at-will employee. Employment law, nor discrimination protection law, have anything to say about dismissing at-will employees who are surplus to business needs. Any kind of competent HR department will be able to manage a paper trail sufficient to dismiss at-will employees in a bullet-proof way, especially in a general business turndown.
      - fnordpiglet 4y ago
        That’s untrue, lay-offs and not for cause terminations have all sorts of protections and implications for the employer. The employment law body for not for cause termination is substantial, and discrimination law absolutely applies in not for cause termination - if they laid off all their pregnant and black employees you don’t think there would be liability?
sidcool 4y ago
Day by day I am getting dissolutioned by Musk
- fnordpiglet 4y ago
  Pedo malarkey didn’t convince you already?
  - sidcool 4y ago
    Honestly it didn't. It seemed juvenile and egoistic. But not nefarious. I still hope Elon comes back to what he does the best.
papito 4y ago
This sounds like a petulant move. Musk has been acting like a child lately. The government is after him, the libs are after him. Everyone is just STIFLING his freedom to do whatever it is he can't do. I bet he is doing this out of spite. The man has been acting really strange in the past few months.
- evan_ 4y ago
  Announced right around the time of another stronger-than-expected jobs report so I think spite is definitely on the table.
avereveard 4y ago
Doesn't these company fire the low 10% ranked employer like every year? Maybe it's news this year because it stopped the during covid, but it's a pretty standard modus operandi.
- sf_rob 4y ago
  That's an IBM-ism that has a lot of mind-share but is far from the standard operating procedure of most tech cos.
  - avereveard 4y ago
    maybe, but this https://www.inc.com/justin-bariso/elon-musk-had-a-very-interesting-response-to-reports-that-tesla-fired-2-of-its-workforce.html https://www.inc.com/justin-bariso/elon-musk-had-a-very-inter... particular https://www.theverge.com/2020/4/7/21213159/tesla-salary-cuts-furloughs-coronavirus-covid-19-pandemic https://www.theverge.com/2020/4/7/21213159/tesla-salary-cuts... company https://edition.cnn.com/2019/01/18/business/tesla-layoffs-elon-musk/index.html https://edition.cnn.com/2019/01/18/business/tesla-layoffs-el... has https://www.washingtonpost.com/news/wonk/wp/2018/06/12/tesla-to-lay-off-9-percent-of-its-workers/ https://www.washingtonpost.com/news/wonk/wp/2018/06/12/tesla... a pattern
aruanavekar 4y ago
they have a list ready no in person, no job
ea550ff70a 4y ago
God, as a Tesla owner myself, this is worrying. Future quality of code and hardware is going to be affected. Musk's extra wild behavior in the past few months is not helping either. My personal experience so far has being great (had it for a few years already) but this is very disappointing tbh.
- seydor 4y ago
  Isnt that a permanent risk attached to teslas?
whatever1 4y ago
Is he still at Saint Tropez with the company jet?
tonoto 4y ago
So.. Did I get this right now? In order to avoid effects of a hypothetical recession, Tesla will cut 10% of the jobs and by doing that, Tesla will be one of the bigger causes of that recession to actually take place?
- jvanderbot 4y ago
  I really don't think Tesla employment count has that big an effect on the broader US economy. Do you?
  - tonoto 4y ago
    I'm not sure on butterfly effects among subcontractors and whether all the affected employees quickly find a new job, but I don't feel this adds up to a positive effect.
  - _ea1k 4y ago
    I'd be surprised if it had a negative impact. Since they are currently hiring production staff for new plants, its likely that overall staffing will still be higher 12 months from now than today.
- evan_ 4y ago
  One read is that Elon and others actively want to cause a recession.
peter303 4y ago
The board should start with Mr. Musk.
DeathArrow 4y ago
Time to short TSLA for some nice, easy cash?
StevePerkins 4y ago
I guess Tesla can pretend to employ them.
danso 4y ago
Recession or not, Musk's emails (the stoppage of remote work 2 days ago, and then yesterday's "super bad feeling") seem like reactionary outbursts than wise management. What was the point of pissing people off with the abrupt change to the remote work policy, only for the next day to announce imminent layoffs?
- pm90 4y ago
  People have pointed out that he’s likely going through mental health issues and Im inclined to agree with them. He went a bit too far with the Twitter buyout stunt. Honestly, he should just get off social media and take a vacation or something. But of course he’s too egotistical to do that and will try to muddle his way through it. Its amusing to watch as an outsider but I can’t imagine its a lot of fun for people at Musk companies (+ Twitter).
  - abhiminator 4y ago
    It's sad really. I used to idolize him so much. I read through all of WaitButWhy's [0] blog post series on Musk back in '15/'16 and loved every bit of it. He literally became my demigod during my undergrad days. And from all that... to this? From a much admired and respected 'inventor' to a cringeworthy Twitter 'edgelord.' Just been a crazy ride. [0] https://waitbutwhy.com/2017/03/elon-musk-post-series.html https://waitbutwhy.com/2017/03/elon-musk-post-series.html
    - ModernMech 4y ago
      You've gotta ask yourself: has there really be a fall from grace? Because there are those of us who saw him as a cringeworthy Twitter 'edgelord' in 2015, and we don't notice much of a difference at all today. It's probably just that he's being more consistently overt about it, and his PR machine can't compensate.
    - rchaud 4y ago
      What did you think of his public behaviour over the past few years? It's one thing to be enthralled by a praise-heavy series of blog posts, but it's not like you couldn't get first-hand impressions from the man's own very public persona.
DeathArrow 4y ago
I wonder if the shrinking of Tesla business translates to others in the electric car industry.
- redisman 4y ago
  Boring old legacy automakers are starting to eat their pie I bet. Self driving is their stated advantage but that’s still unknown if or when it’ll work well enough for general use. Meanwhile Ford and VW and one day Toyota will figure out how to build the much simpler cars (compared to gas ones) and undercut with better prices
lkxijlewlf 4y ago
All that huffing and puffing about remote workers having to return to office was just more of his immature bluster hiding the fact that he was eliminating positions anyway.
mensetmanusman 4y ago
This makes sense in regards to comments about remote work. Sometimes it’s cheaper to give people a reason to leave instead of firing them. Also, this is supply chain related.
TheDesolate0 4y ago
Leader2light 4y ago
[dead]
splitstud 4y ago
zerop 4y ago
I believe that it's not recession, but a downturn of the boom created due to covid. It would be corrected and settle.
c8g 4y ago
Just curious, how much money they can save firing 10% employee? so they can survive almost 10% more days, right? It seems to me it is not that much effective.
- SpicyLemonZest 4y ago
  They're profitable, so it's not that they're trying to stretch out some fixed pool of money. One big thing that reducing costs can do is help them stay profitable as the economy gets worse, although that's not the only reason they might want to do something like this.
  - elkos 4y ago
    Are they profitable in the context of uniform standard accounting practice?
    - SpicyLemonZest 4y ago
      Yes, pretty strongly so. Their GAAP profit was $5.5 billion in FY 2021.
- renewiltord 4y ago
  Wait, no, that's not right. Say you have $100 in the bank and you make $100/month and spend $110/month on people and that's the only expenditure. You're going to survive 10 months. Suppose you fire 10%, so now you spend $99/month and let's say revenue is linear, so now you make $90/month. You're now going to last 100/9 = 11.11 months and that's more than 10% longer already. Now if you fire from positions that you got in anticipation of them contributing but they don't then you could even go negative to positive. So it's not 10% more days even in the worst case where you are running something like a consulting business where revenue is proportional to number of heads and for complex operations it can make you profitable.
mabbo 4y ago
It's really starting to feel more and more like the end of 2007 and start of 2008. Stocks on a steady downward trend. Layoffs starting here and there. Growth slowing across various industries. I took a macro economics course at university that year, taught by a professor who was just about to retire after 40 years of teaching the subject. He was blunt with us: "I don't know what's going to happen, but I bet it's going to be interesting!". I don't even know if he's still alive (he was in his 70s then and still teaching!) but I bet if he is, he's saying the same things now.
- MichaelRazum 4y ago
  Thinking the same. I think the main difference is that we have inflation AND real economic constrains. Anyway what is the best way to hedge? Some say cash is king, but it is kind of counter intuitive, since inflation is high.
  - stocknoob 4y ago
    If you want to hedge your portfolio, do a costless collar.
    - MichaelRazum 4y ago
      Sounds interesting, how does it work?
      - stocknoob 4y ago
        https://www.optionsplaybook.com/option-strategies/collar-option/ https://www.optionsplaybook.com/option-strategies/collar-opt... Basically, you sell a call option, and use the proceeds to buy a protective put option. You can buy a protective put directly, but that costs money. This helps offset the cost buy selling a call. You can play with the strike prices of each to get more/less insurance depending on your risk tolerance. For example, you might sell a call 5% above current prices (expiring in a year), buy a put for 10% below prices (expiring in a year), and pocket the difference.
      - 4y ago
tzm 4y ago
> "seen by Reuters" Do you find it odd that all the stories coming out refer to this single Reuters statement?
- redisman 4y ago
  It’s a huge company nowadays. It’s not exactly hard to verify with a few employees
bhauer 4y ago
The clarification email Musk sent to all staff had this to say: > Tesla will be reducing salaried headcount by 10%, as we have become overstaffed in many areas. Note, this does not apply to anyone actually building cars, battery packs or installing solar. Hourly headcount will increase. This addresses any confusion about how two new factories could ramp if overall headcount was going to take a 10% hit. But to be fair to CNBC, they probably didn't have this context when they wrote the article and headline. Source: https://twitter.com/WholeMarsBlog/status/1532728341865943040 https://twitter.com/WholeMarsBlog/status/1532728341865943040
4dregress 4y ago
I don't understand why people would want to work for this guy? To any Tesla employees, whats your take on this? I can imagine having a CEO like this must be super stressful!
- coolspot 4y ago
  Interesting work. Robotic factories, Fool Self Driving, Machine Learning on huge real-world dataset, etc, etc.
  - jjulius 4y ago
    >... Fool Self Driving... One of those moments where the typo feels a lot more accurate than the correct word.
- me_me_mu_mu 4y ago
  Same reason people work for Bezos, Zuck, etc. A lot of people have the capacity to set aside morals/ethics for a bit of chump change. The work is interesting. I'm sure the people making nuclear bombs probably said the same thing. Or the death star. "It is such interesting work" Yeah ok.
4dregress 4y ago
I'm so glad I changed my contract to be remote first!
hedora 4y ago
Any idea why Tesla is laying people off? I figure it has to be systemic supply chain / logistics failures, or maybe lack of confidence in their product moving forward. The article says "super bad feeling about the economy", and that their Shanghai factory hasn't been able to reopen. The former sounds like BS. Then it talks about inflation concerns, but that's not a good reason to get rid of employees that will be locked into pre-inflation salaries for the next N years. Other than "we're not fixing the factory any time soon", the only thing I can think of is that they're looking at early market share info, and expect to be steam rolled by the existing auto manufacturers in the next few years (to the point where they can make more cars than they can sell, which is currently unthinkable!) [Edit: A sibling comment says this won't touch the manufacturing parts of the company. So, they're laying off sales, management and engineering, I guess? That's a better fit with Elon's ego. I guess the plan is to just coast for a few years during the downturn? If so, that's a textbook mistake big companies make during recessions -- when the economy recovers, they're surprised that they're not competitive anymore!]
anon_12012020 4y ago
Reuters headlines are mostly hit pieces on Tesla.
Havoc 4y ago
That explains the back to office bold stance. People are much more compliant when afraid of losing their livelihoods
andrew_ 4y ago
Came here hoping for insightful thoughts about the layoffs and market conditions only to be presented with a tidalwave of hate seemingly stemming from a lot of personal dislike of the Tesla CEO. There's been a lot of chatter lately about how HN is getting more and more negative, and this appears to be evidence of valid criticism.
- zarriak 4y ago
  I appreciate wanting proper discussion but if you genuinely thought that any comment section discussing Elon Musk was going to be productive I would like to ask for a counter example where one has occurred. It would be very instructive in many ways on how to build such a community and platform.
  - andrew_ 4y ago
    I get your point. Is that an excuse for HN to give into the same? If I wanted outrage and ranting on personalities, there's a lot of other places I could go for that. I came here a few years back because it was a less hostile, more objective community. Genuinely bums me out that we're giving this a pass now just because of the subject matter.
    - zarriak 4y ago
      I get your point but at this point there isn’t any place that can constructively hold this conversation. I still this type of conversations can happen but it is difficult because of the inherent biases against and for the people conveying the messages that is going to be much stronger in the cohort that uses HN.
- pmcollins 4y ago
  Same. I wouldn't have expected this amount of vitriol on a site for science and technology enthusiasts and hackers -- people who often are the builders in society -- about a guy who ... successfully builds electric cars and spaceships. It's a shame because the thoughtful, moderate commenters just leave and are less likely to come back. And btw SpaceX laid off around the same pct of workers a while back and they're doing fine now. Same with a lot of companies, some of which I was working for at the time, and I don't think their leadership was evil.
lolbert2 4y ago

430 points by ra7 4y ago

deleted 4y ago

[deleted]

draw_down 4y ago

jleyank 4y ago

Make that popcorn. Elon’s going to try and dodge all those laws and rules about layoffs, severance, etc. The only thing he might end up hiring is lawyers.

toomuchtodo 4y ago
Musk’s return to office directive is likely a mechanism to force quits and avoid the WARN act and paying severance to thousands of workers. Edit: If you’re looking for SWEs, I’ve spoken to three at Tesla who are looking for new opportunities. They’re an org to target for talent acquisition.
- HWR_14 4y ago
  Yeah, his directive seemed obviously aimed at getting people to quit. As I have understand it, legally, that's transparently the same thing. Hence his very public hiring of lawyers whose qualifications are "fighting" to discourage employees from seeking what they are owed.
  - that_guy_iain 4y ago
    I think it's not legally the same thing. Since doing things to get people to quit have to be larger than you need to work at your place of employment. It's moving them across the country, making them work unsocialable hours, etc. Not returning to the office, which the goverment actually wants. Remote work is bad for the economy.
    - Silhouette 4y ago
      Remote work is bad for the economy. I've seen this claim a few times now. Are we actually sure it's true? Or does it just shift long-term spending trends? For example maybe people don't go to lots of inner city coffee bars in business districts any more but local cafes near residential areas are thriving. Maybe people don't stop in big stores on their way home from work but home delivery services are thriving. Maybe bad managers who don't understand how to support and motivate their teams are having problems with people slacking off at home. What if good managers who look after their people and engender a degree of trust and even loyalty are improving their team's performance by making their people's lives better? It seems far too early to draw broad conclusions about the effects of population-scale remote working but early enough to be confident that some people really like it but it's not for everyone and that some types of businesses benefit from the shift away from the office while others lose out.
      - ghaff 4y ago
        It's probably bad for cities in general, whether inner city coffee bars or office (and probably residential) real estate. And that may (or may not) be bad for people who want to live in cities. My observation though based just on traffic patterns is that debates about remote work are something of a bubble at this point. When I've had to go into the relatively nearby city a couple times lately rush hour traffic seemed as bad as ever although train/subway seemed relatively light.
      - that_guy_iain 4y ago
        > For example maybe people don't go to lots of inner city coffee bars in business districts any more but local cafes near residential areas are thriving. People don't buy coffee on the way to work, people don't buy coffee on the way home, people don't buy sandwiches and snacks, people don't spend money on commuting, people don't spend money at resturants for launch, companies stop having team lunches. People don't go to cafes locally because they have a coffee machine at home. Most people buy coffee and drinks on the way to work out of ease not that they taste better. > Maybe bad managers who don't understand how to support and motivate their teams are having problems with people slacking off at home. What if good managers who look after their people and engender a degree of trust and even loyalty are improving their team's performance by making their people's lives better? This talk of having good and bad managers makes no real sense. Companies aren't just going to fire managers. That would be unfair. > It seems far too early to draw broad conclusions about the effects of population-scale remote working but early enough to be confident that some people really like it but it's not for everyone and that some types of businesses benefit from the shift away from the office while others lose out. Too early? Two-years in?
rossdavidh 4y ago
1) you're likely correct, the "return-to-office" was in part a stealth layoff 2) given that this sort of thing is very common during a downturn, I think Tesla's lawyers probably have a well worked out method on how to do it; I'm not saying it's kosher, but it's common. The only reason this gets so much press is that it's Elon Musk.
deleted 4y ago
[deleted]

akmittal 4y ago

So this was not enough? https://mobile.twitter.com/BBCWorld/status/1532044561807179779 https://mobile.twitter.com/BBCWorld/status/15320445618071797...

that_guy_iain 4y ago
Well, that happened yesterday and is probably part of their process of reducing numbers by 10%. It's better if they quit than if they're laid off.
- alkonaut 4y ago
  Except if yo lay off 10% you get to cut (at least some of) the 10% you want to get rid off. And if you rely on persuading people to quit by reducing satisfaction, you'll get rid of a large chunk of the 10% best employees instead.
  - that_guy_iain 4y ago
    Not really. The people who will flee because of this will also flee because of layoffs and look for somewhere more secure. And everyone is acting like the best employees are going to be the ones quitting. Nah, the best employees are highly engaged employees not ones that are technically talented but will flee just because they have to go to an office. Your most technically talented employees are often not your best employees nor your most valuable. They're important and expensive, but the person in ops that gets paid a low salary but knows the ins and outs of everything and knows how to troubleshoot everything to the point that stuff is fixed is vital. A software developer who is really smart can and will be replaced. There will be HR people working on retention of top employees as we speak. https://www.mckinsey.com/business-functions/m-and-a/our-insights/talent-retention-and-selection-in-m-and-a https://www.mckinsey.com/business-functions/m-and-a/our-insi... gives an insight into this when it comes to M&As
    - watwut 4y ago
      "Highly engaged employees" do actually leave when management does things like "intentionally trying to alienate and push employees away". People who are highly engaged want to be highly engaged and don't like changes that lowers engagement. Changes designed to alienate employees are alienating highly engaged employees as much as they alienate everyone else. Except that, if you are already alienated, you are used to it. When you used to be engaged, you perceive the change as very negative. Also, have you ever worked in a company affected by consultants like you suggest? They don't have capability to recognize or motivate good people .

that_guy_iain 4y ago

Everyone has a super bad feeling about the economy. I think most large companies are going to be announcing back to office then followed by layoffs.

xxs 4y ago
It won't be 2007-2008 bad, but there will be a recession. First lay offs tend to be the R&D.
- that_guy_iain 4y ago
  I agree I don't think it'll be 2007-2008 bad. I think it'll be worse. Covid, Ukraine, Remote Work, etc are all hammering the economy.
  - itsoktocry 4y ago
    >bad. I think it'll be worse. Different. 2007/08 was a financial crisis, and global banking infrastructure almost imploded. Here we're talking about deglobalization, supply chain issues and, well, a war. What's interesting is that the main problems may not be US focussed, it may happen around the world (although no one will be safe). For example, hard to imagine the Canadian real estate sector isn't going to melt down...
    - myth_drannon 4y ago
      "For example, hard to imagine the Canadian real estate sector isn't going to melt down..." - Oh, how many times did I hear that, but it's wishful thinking. At best it's 20% down
      - achenatx 4y ago
        bear in mind that 20% down is often times losing 100% of your capital due to leverage.

cmrdporcupine 4y ago

Uh,ok... Two days ago the "Who is hiring" thread here had something like 20+ software engineering positions for Tesla. https://news.ycombinator.com/item?id=31585021 https://news.ycombinator.com/item?id=31585021 More erratic decision making from Mr Musk. Like, I dunno, the time he told Twitter he was taking Tesla private while tripping on LSD. He needs to step aside from Tesla at this point.

fibers 4y ago
The same can be said about Coinbase and look what's happening. Let's just say buyer beware when it comes to meme companies.
- cmrdporcupine 4y ago
  The thing is, Tesla isn't a Coinbase. Tesla is now a giant manufacturing company that makes a lot of things, brings in revenue, and has some really solid engineering. I don't like their cars from a UX standpoint, but the engineering in their motors and battery packs are solid good products. Move fast and break things might have been fine in the early days. Seems to me like the company needs to 'grow up' and demonstrate responsibility to shareholders and customers, and to do that it likely involves significantly sidelining Musk, who clearly behaves very erratically.
  - Isinlor 4y ago
    The idea of shareholders sidelining Musk is crazy. Shareholders paid him tens of billions to stay after he wanted to step down as CEO after Model 3 push. https://www.theguardian.com/business/2022/apr/21/elon-musk-stands-to-collect-23bn-bonus-as-tesla-surges-ahead https://www.theguardian.com/business/2022/apr/21/elon-musk-s... Elon Musk is golden goose for Tesla shareholders.
    - bitwize 4y ago
      The fact remains that Musk is the techbro Kanye West, and shareholders should sideline him.

GiorgioG 4y ago

Shocking - it was in no way obvious Tesla was trying to trim headcount /s https://news.ycombinator.com/item?id=31580739 https://news.ycombinator.com/item?id=31580739

alkonaut 4y ago

> The message, sent on Thursday and titled “pause all hiring worldwide”, came two days after the billionaire told staff to return to the workplace or leave So people who claimed less than 24h ago it was at lest partially a way of creating cheap layoffs, were proven right pretty swiftly.

hooande 4y ago
It's hard to imagine that severance from a 10% layoff is a significant cost for a company of Tesla's size and revenue. It's not small by any means, but not necessarily worth a complicated scheme in relative terms
- formerkrogemp 4y ago
  I think it's just a game for executives at this point to think of what dumb policy will people put up with to keep their jobs or to quit and reduce severance.
lapcat 4y ago
Remember when Marissa Mayer eliminated WFH at Yahoo? Seemed to work out well for them.
- mjr00 4y ago
  Do you really think Yahoo would have avoided its fate if it had continued allowing WFH? I don't think it was a good decision, but Yahoo had/has way more issues with its business than whether or not it allows employees to WFH.
  - TheBigSalad 4y ago
    No, but it's one of those decisions that most normal people could easily recognize as a bad decision. It clearly didn't have any positive impact on the company and most likely had a negative impact. Just a CEO doing pure nonsense, causing a huge impact to the company based on ego over data. As opposed to making actual positive decisions. There was no reason for yahoo to fail other than a huge series of poor leadership decisions.

ericbarrett 4y ago

A couple of days ago somebody posted this Reddit thread: https://old.reddit.com/r/cscareerquestions/comments/v2lpdw/elon_musk_just_asked_all_employees_to_return_to/ https://old.reddit.com/r/cscareerquestions/comments/v2lpdw/e... "Tesla expanded massively during Covid, as of now half of the dev team(including me) don’t have parking space or desk. It’s physically impossible for everyone to return to office. "Should I ignore the email, or should I drive to the office and sit under the stairs?" Commenters' general feeling was that it was a soft layoff, and some speculated that it might amount to constructive dismissal.

gamblor956 4y ago
Commenters' general feeling was that it was a soft layoff, and some speculated that it might amount to constructive dismissal. Another instance of Tesla violating labor laws, this time to get out of paying unemployment....
that_guy_iain 4y ago
They can and will buy desks.
- kenferry 4y ago
  When people say “no desk” what they mean is “no space in the building to allocate a desk”.
  - that_guy_iain 4y ago
    When people say "no space in the building to allocate a desk” they mean "No space to neatly put a desk." Companies have often shown repeatedly they can force desks into rooms when needed. Anyways, they can and will buy office space to put the desks when needed.
    - sillysaurusx 4y ago
      Lol. I can confirm that a motivated company can Tetris a lot more desks into a room than you’d expect. My first job… ah, memories.

raphaelj 4y ago

> Elon Musk feels ‘super bad’ about economy Considering how bad Elon is at making predictions, this is actually great news.

jes 4y ago
Can you say more? Musk is the world’s wealthiest individual. I’m having trouble seeing see how being bad at making predictions results in that outcome.
- manuelabeledo 4y ago
  > Musk is the world’s wealthiest individual. On paper. He bet big on EVs, which the market rewarded. Same happened with Microsoft and computers maybe thirty years ago, main difference being that Tesla is not holding a semi monopoly, and competitors are catching up quickly.
  - rcMgD2BwE72F 4y ago
    >and competitors are catching up quickly. How do you measure that? All sales figures show the contrary. Also, two days ago https://www.bloomberg.com/news/articles/2022-06-01/vw-ceo-says-tesla-moves-at-double-speed-in-changing-industry https://www.bloomberg.com/news/articles/2022-06-01/vw-ceo-sa... >Volkswagen AG said Tesla Inc. is moving twice as quickly as the rest of the industry that needs to pick up the pace in the shift to making electric vehicles packed with software.
    - raphaelj 4y ago
      Tesla sales growth, but slower than the EV market. Tesla is thus loosing market share (in EV) while increasing revenue.
- raphaelj 4y ago
  Just top of my mind: "Covid will be gone by April 2020": https://twitter.com/elonmusk/status/1240754657263144960 https://twitter.com/elonmusk/status/1240754657263144960 "FSD will be achieved by 2018": https://twitter.com/elonmusk/status/686279251293777920 https://twitter.com/elonmusk/status/686279251293777920 "Neuralink in human brains by 2020": https://news.yahoo.com/everything-know-neuralink-elon-musks-103000152.html https://news.yahoo.com/everything-know-neuralink-elon-musks-... Being wealthy has also a lot to do with being at the right place, at the right time, inherited wealth, and outsourcing efficiently.

drfuchs 4y ago

Anybody care to speculate on the chance that Twitter forces their sale to him, and then TSLA goes down far enough that Musk gets a margin call on the loan he's using to finance the purchase, and he loses everything? Or at least half of everything?

javajosh 4y ago
I think it's a very high likelihood. Why? Because Musk is idea-driven and doesn't really care about money, so he is the perfect person to harness with financial and legal obligation, because he will continue to pull no matter what. Sure it's slavery with extra steps, plus so many people hate Musk there's not even a cultural downside!
- Swenrekcah 4y ago
  Wait a minute.. Are you suggesting it’s slavery to hold a billionaire businessman to his contracts?
  - formerkrogemp 4y ago
    > Sure it's slavery with extra steps, plus so many people hate Musk there's not even a cultural downside! Musk is a slave? Best conspiracy theory I've heard this month.
  - javajosh 4y ago
    I'm just saying his counter-parties have good reason to go for blood, because he's got a lot of it .
- Marazan 4y ago
  He doesn't care about money which is why he complains about taxes all the time?
- tyrfing 4y ago
  After you have a binding deal like the one he signed, it's very hard to get out of it. Being forced to complete the deal anyway has precedent, like 2 years ago when LVMH tried to back out of their Tiffany deal due to Covid. https://www.law360.com/articles/1324006/tiffany-lvmh-lower-merger-price-to-15-8b-settle-dispute https://www.law360.com/articles/1324006/tiffany-lvmh-lower-m...

adverbly 4y ago

Let me get this straight: "Work 80 hr weeks! Be just like me!" Musk: becomes worlds richest person Employees: laid off What planet do you live on where you see this as a sustainable, world-improving system for the world and for compensation? Anyone that works 50 hr weeks for this dude is out of their mind.

dionidium 4y ago
People should be free to make that decision for themselves. At a low enough resolution basically nobody works at Tesla. It's a big world and there are lots of options.
sillysaurusx 4y ago
There’s a more general idea here: don’t work more than you want to, after the amount you’re required to.
0daystock 4y ago
You act like exploitation of employees is exclusive to Tesla, or even the tech industry. The reality is far worse than you can even imagine.
- lapcat 4y ago
  > You act like exploitation of employees is exclusive to Tesla, or even the tech industry. Where did the OP say or imply that?
  - 0daystock 4y ago
    The part where he complains that an exchange of 50 hours of labor for compensation at the top 5% of the world is somehow unfair or abusive, and is otherwise surprised by the concept of at-will employment.
    - lapcat 4y ago
      > surprised by the concept of at-will employment I seriously doubt the OP was surprised by the concept of at-will employment. What the OP said was "Anyone that works 50 hr weeks for this dude is out of their mind." In other words, they are doing it voluntarily, but it's still a bad idea for them, maybe even delusional. If you've ever had a bad exit from an employer, you start to rethink the sacrifices you made for the employer while you were there.

leroman 4y ago

If people are afraid for their jobs (or more generally about the economy) they are more likely to do what you say.. WFH.. criticism about Twitter.. all things better discussed when economy recovers.. how convenient..

rinze 4y ago

So the message here seems to be "if you want your employees to leave, make them return to the office".

pwagland 4y ago
No, I think that the real message is "If your employees don't want to leave, make them return to the office". And then you announce a hiring freeze, and that equals an official downsizing.
papito 4y ago
There are a lot of people who are good at looking busy in the office and doing very little. I can come in at 7AM, crush it, and leave at 2PM. Here is the thing, however - the guy who came in at 10:30AM and is sitting at his computer for some reason at 7PM is going to be viewed as the "hard worker". It's all bullshit. If this is what Musk is doing, he is going to shed some of his most productive workers and leave those in place who are just good at fronting.

deleted 4y ago

[deleted]

sys_64738 4y ago

Musk is a narcissistic boss with a moon-sized ego to match.

swamp40 4y ago

I wonder if him coming out as a Republic was a similar tactic as the "return to office" memo? He might be thinking he can get 5% of the people to quit just based on differences in values, making his remaining employees more homogenous and giving them a common culture.

avrionov 4y ago
I wonder if him coming out as a Republic was a similar tactic as the "return to office" memo? He came as Republican not as a Republic. Give it a few more years.

rvz 4y ago

Right. Raise your hand if you were surprised to see this happen. So yesterday when it was Coinbase [0] announcing cuts the reaction was, 'ha ha crypto bad', 'worst of luck to them' and now when it also affects companies like Tesla, now the reaction is 'Shocking', 'everyone is doing it now', 'I wouldn't read much into it. A 10% cut is completely normal and healthy for a company the size of Tesla.' This to me sounds like some form of cope that many thought the market was always going up forever. The recent market rally of 2020 had to come to an end. [0] https://news.ycombinator.com/item?id=31600505 https://news.ycombinator.com/item?id=31600505

vsareto 4y ago
Quick recession, then back to the market always going up. And for longer time spans, it has always gone up.
- mschuster91 4y ago
  > And for longer time spans, it has always gone up. Mostly because of utterly insane injections of cash into the economy, whether by unsafe lending practices creating money out of thin air (which ended up causing 2008ff) or by the central banks creating money out of thin air and buying up assets. Now, especially after two years of pandemic-related bailouts, there's no government whose balance sheet hasn't been hit hard... governments can't take up more debt to inject into the economy, and the central banks cannot because inflation is already skyrocketing across the world. Additionally, the people are fed up with social inequality worldwide - they saw that a lot of wealth was redistributed from the bottom to the top stock owners over the last two years. It may very well be that governments shift focus from propping up the stock markets to preventing social unrest, not to mention climate change which is bound to send a lot of companies' worth towards the bottom as their business model becomes outdated (e.g. car manufacturers, oil/gas companies).
  - deleted 4y ago
    [deleted]
- rvz 4y ago

fnordpiglet 4y ago

Most companies I’ve ever worked at top grade yearly and lay off 5-10% of the workforce as a business practice. The fifth quartile it’s been called. I’m not saying that’s what’s happening here to be clear. But a 10% RIF isn’t unusual.

studmuffin650 4y ago

Interested to see this go down in parallel with Elon's "everyone must be in office decree". I have multiple friends that work at Tesla and at least one of them has it in their work contract to allow remote work for at least a year (they started 2 weeks ago). Not sure how his decree will work out (though I have only heard about the employment contract, not actually seen it).

erikpukinskis 4y ago
Unless your friend lives in Montana, their employment is “at-will”. Which means at any time Tesla can change their mind on any aspect of the agreement and offer you a choice between a new contract or the door.
- ProjectArcturis 4y ago
  Yes, but having that in an offer letter or work contract makes it a lot easier to argue for constructive dismissal.
- fnordpiglet 4y ago
  That’s not true. At will is almost never an excuse for violating contracts, employment law, or various discrimination protections. That said they can do it, but they would expose themselves to copious lawsuit liability.
  - NovemberWhiskey 4y ago
    Being a contract worker is the alternative to being an at-will employee. Employment law, nor discrimination protection law, have anything to say about dismissing at-will employees who are surplus to business needs. Any kind of competent HR department will be able to manage a paper trail sufficient to dismiss at-will employees in a bullet-proof way, especially in a general business turndown.
    - fnordpiglet 4y ago
      That’s untrue, lay-offs and not for cause terminations have all sorts of protections and implications for the employer. The employment law body for not for cause termination is substantial, and discrimination law absolutely applies in not for cause termination - if they laid off all their pregnant and black employees you don’t think there would be liability?

sidcool 4y ago

Day by day I am getting dissolutioned by Musk

fnordpiglet 4y ago
Pedo malarkey didn’t convince you already?
- sidcool 4y ago
  Honestly it didn't. It seemed juvenile and egoistic. But not nefarious. I still hope Elon comes back to what he does the best.

papito 4y ago

This sounds like a petulant move. Musk has been acting like a child lately. The government is after him, the libs are after him. Everyone is just STIFLING his freedom to do whatever it is he can't do. I bet he is doing this out of spite. The man has been acting really strange in the past few months.

evan_ 4y ago
Announced right around the time of another stronger-than-expected jobs report so I think spite is definitely on the table.

avereveard 4y ago

Doesn't these company fire the low 10% ranked employer like every year? Maybe it's news this year because it stopped the during covid, but it's a pretty standard modus operandi.

sf_rob 4y ago
That's an IBM-ism that has a lot of mind-share but is far from the standard operating procedure of most tech cos.
- avereveard 4y ago
  maybe, but this https://www.inc.com/justin-bariso/elon-musk-had-a-very-interesting-response-to-reports-that-tesla-fired-2-of-its-workforce.html https://www.inc.com/justin-bariso/elon-musk-had-a-very-inter... particular https://www.theverge.com/2020/4/7/21213159/tesla-salary-cuts-furloughs-coronavirus-covid-19-pandemic https://www.theverge.com/2020/4/7/21213159/tesla-salary-cuts... company https://edition.cnn.com/2019/01/18/business/tesla-layoffs-elon-musk/index.html https://edition.cnn.com/2019/01/18/business/tesla-layoffs-el... has https://www.washingtonpost.com/news/wonk/wp/2018/06/12/tesla-to-lay-off-9-percent-of-its-workers/ https://www.washingtonpost.com/news/wonk/wp/2018/06/12/tesla... a pattern

aruanavekar 4y ago

they have a list ready no in person, no job

ea550ff70a 4y ago

God, as a Tesla owner myself, this is worrying. Future quality of code and hardware is going to be affected. Musk's extra wild behavior in the past few months is not helping either. My personal experience so far has being great (had it for a few years already) but this is very disappointing tbh.

seydor 4y ago
Isnt that a permanent risk attached to teslas?

whatever1 4y ago

Is he still at Saint Tropez with the company jet?

tonoto 4y ago

So.. Did I get this right now? In order to avoid effects of a hypothetical recession, Tesla will cut 10% of the jobs and by doing that, Tesla will be one of the bigger causes of that recession to actually take place?

jvanderbot 4y ago
I really don't think Tesla employment count has that big an effect on the broader US economy. Do you?
- tonoto 4y ago
  I'm not sure on butterfly effects among subcontractors and whether all the affected employees quickly find a new job, but I don't feel this adds up to a positive effect.
- _ea1k 4y ago
  I'd be surprised if it had a negative impact. Since they are currently hiring production staff for new plants, its likely that overall staffing will still be higher 12 months from now than today.
evan_ 4y ago
One read is that Elon and others actively want to cause a recession.

peter303 4y ago

The board should start with Mr. Musk.

DeathArrow 4y ago

Time to short TSLA for some nice, easy cash?

StevePerkins 4y ago

I guess Tesla can pretend to employ them.

danso 4y ago

Recession or not, Musk's emails (the stoppage of remote work 2 days ago, and then yesterday's "super bad feeling") seem like reactionary outbursts than wise management. What was the point of pissing people off with the abrupt change to the remote work policy, only for the next day to announce imminent layoffs?

pm90 4y ago
People have pointed out that he’s likely going through mental health issues and Im inclined to agree with them. He went a bit too far with the Twitter buyout stunt. Honestly, he should just get off social media and take a vacation or something. But of course he’s too egotistical to do that and will try to muddle his way through it. Its amusing to watch as an outsider but I can’t imagine its a lot of fun for people at Musk companies (+ Twitter).
- abhiminator 4y ago
  It's sad really. I used to idolize him so much. I read through all of WaitButWhy's [0] blog post series on Musk back in '15/'16 and loved every bit of it. He literally became my demigod during my undergrad days. And from all that... to this? From a much admired and respected 'inventor' to a cringeworthy Twitter 'edgelord.' Just been a crazy ride. [0] https://waitbutwhy.com/2017/03/elon-musk-post-series.html https://waitbutwhy.com/2017/03/elon-musk-post-series.html
  - ModernMech 4y ago
    You've gotta ask yourself: has there really be a fall from grace? Because there are those of us who saw him as a cringeworthy Twitter 'edgelord' in 2015, and we don't notice much of a difference at all today. It's probably just that he's being more consistently overt about it, and his PR machine can't compensate.
  - rchaud 4y ago
    What did you think of his public behaviour over the past few years? It's one thing to be enthralled by a praise-heavy series of blog posts, but it's not like you couldn't get first-hand impressions from the man's own very public persona.

DeathArrow 4y ago

I wonder if the shrinking of Tesla business translates to others in the electric car industry.

redisman 4y ago
Boring old legacy automakers are starting to eat their pie I bet. Self driving is their stated advantage but that’s still unknown if or when it’ll work well enough for general use. Meanwhile Ford and VW and one day Toyota will figure out how to build the much simpler cars (compared to gas ones) and undercut with better prices

lkxijlewlf 4y ago

All that huffing and puffing about remote workers having to return to office was just more of his immature bluster hiding the fact that he was eliminating positions anyway.

mensetmanusman 4y ago

This makes sense in regards to comments about remote work. Sometimes it’s cheaper to give people a reason to leave instead of firing them. Also, this is supply chain related.

TheDesolate0 4y ago

Leader2light 4y ago

[dead]

splitstud 4y ago

zerop 4y ago

I believe that it's not recession, but a downturn of the boom created due to covid. It would be corrected and settle.

c8g 4y ago

Just curious, how much money they can save firing 10% employee? so they can survive almost 10% more days, right? It seems to me it is not that much effective.

SpicyLemonZest 4y ago
They're profitable, so it's not that they're trying to stretch out some fixed pool of money. One big thing that reducing costs can do is help them stay profitable as the economy gets worse, although that's not the only reason they might want to do something like this.
- elkos 4y ago
  Are they profitable in the context of uniform standard accounting practice?
  - SpicyLemonZest 4y ago
    Yes, pretty strongly so. Their GAAP profit was $5.5 billion in FY 2021.
renewiltord 4y ago
Wait, no, that's not right. Say you have $100 in the bank and you make $100/month and spend $110/month on people and that's the only expenditure. You're going to survive 10 months. Suppose you fire 10%, so now you spend $99/month and let's say revenue is linear, so now you make $90/month. You're now going to last 100/9 = 11.11 months and that's more than 10% longer already. Now if you fire from positions that you got in anticipation of them contributing but they don't then you could even go negative to positive. So it's not 10% more days even in the worst case where you are running something like a consulting business where revenue is proportional to number of heads and for complex operations it can make you profitable.

mabbo 4y ago

It's really starting to feel more and more like the end of 2007 and start of 2008. Stocks on a steady downward trend. Layoffs starting here and there. Growth slowing across various industries. I took a macro economics course at university that year, taught by a professor who was just about to retire after 40 years of teaching the subject. He was blunt with us: "I don't know what's going to happen, but I bet it's going to be interesting!". I don't even know if he's still alive (he was in his 70s then and still teaching!) but I bet if he is, he's saying the same things now.

MichaelRazum 4y ago
Thinking the same. I think the main difference is that we have inflation AND real economic constrains. Anyway what is the best way to hedge? Some say cash is king, but it is kind of counter intuitive, since inflation is high.
- stocknoob 4y ago
  If you want to hedge your portfolio, do a costless collar.
  - MichaelRazum 4y ago
    Sounds interesting, how does it work?
    - stocknoob 4y ago
      https://www.optionsplaybook.com/option-strategies/collar-option/ https://www.optionsplaybook.com/option-strategies/collar-opt... Basically, you sell a call option, and use the proceeds to buy a protective put option. You can buy a protective put directly, but that costs money. This helps offset the cost buy selling a call. You can play with the strike prices of each to get more/less insurance depending on your risk tolerance. For example, you might sell a call 5% above current prices (expiring in a year), buy a put for 10% below prices (expiring in a year), and pocket the difference.
    - 4y ago

tzm 4y ago

> "seen by Reuters" Do you find it odd that all the stories coming out refer to this single Reuters statement?

redisman 4y ago
It’s a huge company nowadays. It’s not exactly hard to verify with a few employees

bhauer 4y ago

The clarification email Musk sent to all staff had this to say: > Tesla will be reducing salaried headcount by 10%, as we have become overstaffed in many areas. Note, this does not apply to anyone actually building cars, battery packs or installing solar. Hourly headcount will increase. This addresses any confusion about how two new factories could ramp if overall headcount was going to take a 10% hit. But to be fair to CNBC, they probably didn't have this context when they wrote the article and headline. Source: https://twitter.com/WholeMarsBlog/status/1532728341865943040 https://twitter.com/WholeMarsBlog/status/1532728341865943040

4dregress 4y ago

I don't understand why people would want to work for this guy? To any Tesla employees, whats your take on this? I can imagine having a CEO like this must be super stressful!

coolspot 4y ago
Interesting work. Robotic factories, Fool Self Driving, Machine Learning on huge real-world dataset, etc, etc.
- jjulius 4y ago
  >... Fool Self Driving... One of those moments where the typo feels a lot more accurate than the correct word.
me_me_mu_mu 4y ago
Same reason people work for Bezos, Zuck, etc. A lot of people have the capacity to set aside morals/ethics for a bit of chump change. The work is interesting. I'm sure the people making nuclear bombs probably said the same thing. Or the death star. "It is such interesting work" Yeah ok.

4dregress 4y ago

I'm so glad I changed my contract to be remote first!

hedora 4y ago

Any idea why Tesla is laying people off? I figure it has to be systemic supply chain / logistics failures, or maybe lack of confidence in their product moving forward. The article says "super bad feeling about the economy", and that their Shanghai factory hasn't been able to reopen. The former sounds like BS. Then it talks about inflation concerns, but that's not a good reason to get rid of employees that will be locked into pre-inflation salaries for the next N years. Other than "we're not fixing the factory any time soon", the only thing I can think of is that they're looking at early market share info, and expect to be steam rolled by the existing auto manufacturers in the next few years (to the point where they can make more cars than they can sell, which is currently unthinkable!) [Edit: A sibling comment says this won't touch the manufacturing parts of the company. So, they're laying off sales, management and engineering, I guess? That's a better fit with Elon's ego. I guess the plan is to just coast for a few years during the downturn? If so, that's a textbook mistake big companies make during recessions -- when the economy recovers, they're surprised that they're not competitive anymore!]

anon_12012020 4y ago

Reuters headlines are mostly hit pieces on Tesla.

Havoc 4y ago

That explains the back to office bold stance. People are much more compliant when afraid of losing their livelihoods

andrew_ 4y ago

Came here hoping for insightful thoughts about the layoffs and market conditions only to be presented with a tidalwave of hate seemingly stemming from a lot of personal dislike of the Tesla CEO. There's been a lot of chatter lately about how HN is getting more and more negative, and this appears to be evidence of valid criticism.

zarriak 4y ago
I appreciate wanting proper discussion but if you genuinely thought that any comment section discussing Elon Musk was going to be productive I would like to ask for a counter example where one has occurred. It would be very instructive in many ways on how to build such a community and platform.
- andrew_ 4y ago
  I get your point. Is that an excuse for HN to give into the same? If I wanted outrage and ranting on personalities, there's a lot of other places I could go for that. I came here a few years back because it was a less hostile, more objective community. Genuinely bums me out that we're giving this a pass now just because of the subject matter.
  - zarriak 4y ago
    I get your point but at this point there isn’t any place that can constructively hold this conversation. I still this type of conversations can happen but it is difficult because of the inherent biases against and for the people conveying the messages that is going to be much stronger in the cohort that uses HN.
pmcollins 4y ago
Same. I wouldn't have expected this amount of vitriol on a site for science and technology enthusiasts and hackers -- people who often are the builders in society -- about a guy who ... successfully builds electric cars and spaceships. It's a shame because the thoughtful, moderate commenters just leave and are less likely to come back. And btw SpaceX laid off around the same pct of workers a while back and they're doing fine now. Same with a lot of companies, some of which I was working for at the time, and I don't think their leadership was evil.

lolbert2 4y ago