Tesla to slash thousands of jobs in profitability drive

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Tesla is cutting nine percent of its workforce in an effort to achieve profitability, CEO Elon Musk announced in a note sent to employees that elaborated on a planned restructuring he publically announced in May.

The terminated jobs will be confined to salaried positions and not include any production workers, meaning the company's Model 3 productions targets will apparently go unaffected.

Tesla has been dogged with delays surrounding delivery of its all-electric BMW 3 Series-rivalling Model 3 saloon, but continues to push ahead with future products such as the Tesla Semi truck, the new Roadster and an EV alternative the Volkswagen Golf, which Musk alluded to at the company's recent shareholder meeting.

Nearly all of the jobs are salaried positions, Musk said. Most employees assigned to Home Depot positions will have the option to move to Tesla's retail stores, says Musk.

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Musk shared screenshots of the full company restructuring announcement letter on Twitter so that everyone could read it "unfiltered".

In the email, he said the cuts are aimed at eliminating duplicate roles and he does not expect them to affect the firm's production ability.

It wasn't clear what would be the result of "flattening the management structure", but layoffs were expected to be part of the plan.

Together, the Buffalo plant has more than 500 workers, Tesla has said. Tesla has never been profitable in its 15-year existence.

Last month, Musk had hinted at a reorganisation but did not give details. The layoffs will affect around 9% of the company's employees.

After the news broke on Tuesday, Tesla shares rose 2.5 percent to $340,34 per share and even hit as high as $354.97 around noon, the news organization reports. "That is a valid and fair criticism of Tesla's history to date".

Tesla also said it was not renewing its residential sales agreement with retailer Home Depot in order to focus on selling solar power in Tesla stores and online. Tesla still has a significant need for production workers as it tries to reach Model 3 manufacturing targets, he wrote in the email.

"It is very hard to say goodbye", Musk said in the letter.

To those who are departing, thank you for everything you have done for Tesla and we wish you well in your future opportunities.

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