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Tesla shares fall following report of possible layoffs


Cars are seen on the assembly line during a tour of the Tesla Giga Texas manufacturing facility ahead of the 'Cyber Rodeo"[ grand opening party on April 7, 2022 in Austin, Texas. — AFP pic

Cars are seen on the assembly line during a tour of the Tesla Giga Texas manufacturing facility ahead of the ‘Cyber Rodeo”[ grand opening party on April 7, 2022 in Austin, Texas. — AFP pic

Friday, 03 Jun 2022 9:51 PM MYT

NEW YORK, June 3 — Tesla shares fell early today following a report that chief executive Elon Musk wants to trim headcount due to the uncertain economic outlook.

Musk said in an email to executives that he has a “super bad feeling” about the economy, according to a report from Reuters, adding that the electric automaker should pause all hiring and cut about 10 percent of jobs.

Tesla did not immediately respond to a query from AFP.

The statement is the latest from a business leader warning about a slowdown as the Federal Reserve moves aggressively to tighten monetary policy in response to inflation, stoking recession fears.

Tesla had a little more than 100,000 employees at the end of 2021.

CFRA Research analyst Garrett Nelson called the timing of Musk’s email “somewhat odd” considering that Tesla is ramping up new factories in Austin, Texas and Germany.

“But we think Musk wants to get ahead of the curve in terms of a slowdown across the highly cyclical auto industry,” said Nelson in a note, adding that most of the job cuts could come in Shanghai, where China’s zero-tolerance Covid-19 policy has weighed on production.

Shares of Tesla fell 5.6 percent to $730.49 in early trading. — AFP



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