Tesla (TSLA.O) has shuttered its office in San Mateo, California, and laid off roughly 200 employees. Especially those working on its Autopilot driver-assistant system there, in a move seen as accelerating cost-cutting. Most of the laid-off people had been hourly workers, that person said.
Early this month, Tesla Chief Executive Elon Musk told top managers he had a “super bad feeling” about the economy. And that the maker of electric cars needed to cut staff by about 10%. Later, the billionaire said that the 10% cuts would apply only to salaried workers. And that they still expected hourly staff numbers to grow.
“Tesla clearly is in a major cost-cutting mode,” said Raj Rajkumar, professor of electrical and computer engineering at Carnegie Mellon University. “This (staff reduction) likely indicates that 2Q 2022 has been pretty rough on the company. This is due to the shutdown in Shanghai, raw material costs and supply chain problems.”
Anti-pandemic measures in Shanghai have depressed Tesla’s production there. Some said employees at the satellite office were told that they would move to an office in Palo Alto in stages beginning this month after the San Mateo lease expired. But we lay most of the workers off on Tuesday. Most of the workers expected Tesla to shift some jobs to lower-wage workers in Buffalo, New York, to save costs.
Many people in Tesla’s San Mateo office work on data annotation reviewing and labeling various visuals collected from Tesla vehicles. To teach the cars’ Autopilot system how to handle certain kinds of road scenarios. Several Tesla data annotation employees said on LinkedIn on Tuesday that we had laid them off. Musk has also said Tesla’s new factories in Texas and Berlin are “gigantic money furnaces” losing billions of dollars.