Automaker’s global cut includes leading markets US and China

Tesla’s global job cuts include reducing staff in the US and China, the automakers’ two biggest markets, across sales, tech, and engineering, five sources briefed on the matter said.

CEO Elon Musk told staff in an internal memo seen by Reuters that the company is laying off more than 10% of its global workforce, as it grapples with falling sales and an intensifying price war for electric vehicles.

Several US-based service centres saw heavy layoffs effective immediately, primarily of sales staff and technicians, one source said. Another location laid off all front-of-house staff, the source said.

A Tesla programme manager in California posted a spreadsheet on LinkedIn of over 140 staff, mostly engineers, who had been laid off and were seeking new jobs.

Two sources said members of Tesla’s China sales team were being notified they were being made redundant, with one saying more than 10% were losing their jobs.

A third source said that in Shanghai, where Tesla’s largest plant is located, the company will only lay off a small proportion of staff, amounting to “several dozen” people.

Tesla shares fell 2.5% in premarket trading on Tuesday. They closed down 5.6% on Monday.

Tesla’s US headquarters and its China unit did not immediately respond to requests for comment. All the sources declined to be named as they were not permitted to speak to media.

The Shanghai and Beijing local governments did not immediately respond to requests for comment.

Tesla Germany refuted reports in German media that 3,000 of the carmaker’s roughly 12,000 staff had been fired, and said it was evaluating how to implement Musk’s orders at the plant.

“We will pursue the measure for Gigafactory Berlin-Brandenburg against the background of all labour law and co-determination requirements, bringing in the works council,” Tesla Germany said on Tuesday in an emailed statement to Reuters, adding no workers had been notified yet.

German union IG Metall said on Monday that Tesla had not informed or consulted the works council, as is customary in Germany, prior to emailing all staff.

While German labour law has strict rules on firing staff, around 1,000 workers at the plant are on temporary contracts, according to a source with knowledge of the matter, leaving them more vulnerable to dismissal. Tesla faces increasing competition in China in a fierce price war with rivals led by BYD, slowing sales in the United States, as well high investment costs in new models and artificial intelligence.

Global vehicle deliveries in the first quarter fell for the first time in nearly four years, as price cuts failed to stir demand. MNorth Carolina regulators have approved a state mining permit for Tesla supplier Piedmont Lithium to develop one of the largest U.S. sources of the key electric vehicle battery metal, although key financing and local regulatory challenges remain.

The approval from the North Carolina Department of Environmental Quality, which was announced by the company on Monday and is conditional on the posting of a $1 million reclamation bond, removes a major hurdle to Piedmont’s plans to tap a large lithium deposit just outside Charlotte.

Shares in the company, which first applied for the permit in August 2021, rose 33% in morning trading. The state has never turned down a mining permit application.

The go-ahead for the 500-foot-deep mine comes despite widespread opposition from neighbors worried about water, noise pollution and other potential problems.

The years-long opposition to the project, which would become one of the few lithium-producing sites in the U.S, illustrates broadening tension in the country, as resistance to living near a mine clashes with the potential of EVs to mitigate climate change.

Piedmont must still obtain a local zoning variance and financing for the project, estimated to cost more than $1 billion. The company has applied for U.S. Department of Energy loans via a program through which rivals ioneer and Lithium Americas have already obtained financing.

“We plan to develop Carolina Lithium as one of the lowest-cost, most sustainable lithium hydroxide operations in the world,” said Piedmont CEO Keith Phillips.

Piedmont agreed to a deal with Tesla last year to supply spodumene concentrate, a key raw material for making batteries, to the auto giant through 2025, with an option to renew it for another three years.

The state review process involved the submission of thousands of pages of documents, multiple requests for additional information, and at least three deadline extensions for Piedmont.

State officials are also requiring the company to conduct regular water quality and water table levels tests, and to line a waste storage pit with a synthetic liner, a departure from the typical requirement for an earthen liner.