As a result of falling sales and more competition in the electric vehicle market, Tesla will lay off more than 10% of its employees worldwide. In a post on X, CEO Elon Musk referred to the need to reorganize and streamline the company every five years to prepare for “the next phase of growth.”
Two of the company’s senior leaders, Battery Development Chief Drew Baglino and Vice President for Public Policy Rohan Patel also shared news of their departures. Tesla’s CFO Zach Kirkhorn left the company less than a year ago.
The exit of Baglino and Patel indicated the “larger negative signal today” that Tesla’s growth is facing problems, said Michael Ashley Schulman, chief investment officer for Running Point Capital Advisors. However, Rex Shares CEO Scott Acheychek said the layoffs were strategic.
As of late Monday, Tesla shares had dropped 5% to $162.42. However, shares of other EV automakers, such as Rivian Automotive, VinFast Auto and Lucid Group, were trading between 2.2% and 10.7% lower as well.
