Elon Musk says Tesla will cut 9% of its workforce

Reuters

The firm has missed a series of its own production targets for the large volume Model 3 in recent months, citing production issues at its factory.

Elon Musk is cutting 9 per cent of the workforce at Tesla Inc., a turnabout that underscores the mounting pressure he is under to show the electric-car maker can one day turn a profit.

Musk said jobs would be lost from Tesla's "salaried population", but promised "no production associates" will be let go.

Musk goes on to acknowledge that while profitability has never been the electric automaker's strong suit, the company can not go on ignoring the inefficiencies in its workforce if it hopes to achieve its environmental and social goals.

"What drives us is our mission to accelerate the world's transition to sustainable, clean energy, but we will never achieve that mission unless we eventually demonstrate that we can be sustainably profitable", the billionaire entrepreneur wrote in the email.

It's not the first time Tesla has laid off workers. Tesla (TSLA) is still hiring for key positions and will increase its production staff. Tesla has never been profitable in its 15-year existence.

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The U.N. considers Yemen to be the world's worst humanitarian crisis, with more than 22.2 million people in need of assistance. A Saudi-led coalition has been at war with Yemen's Shi'ite Houthi rebels since March 2015.

Musk called the job cuts, which will affect about 9% of the company's more than 40,000 employees, "difficult, but necessary" in a tweet that contained the email he had sent to employees announcing the layoffs.

Tesla has also pushed back against accusations of poor worker safety and discrimination at company facilities, and headline-grabbing wrecks and investigations that have raised questions about the company's semi autonomous technology.

Tesla is ending its partnership with Home Depot and will remove its branded kiosks from as many as 800 of the home improvement chain's USA stores by the end of the year. Wait times for the Model 3 ballooned at the company struggled through "production hell" past year. Employees working at Home Depot stores will have the option of moving to Tesla locations.

He also adds that Tesla will not renew its residential sales agreement with Home Depot.

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

What do you think the future holds for Tesla?

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