San Francisco — Tesla Chief Executive Elon Musk has a “super bad feeling” about the economy and plans to cut around 10% of the jobs at the electric car manufacturer He said this in an email sent to executives that was seen on Thursday by Reuters.
The announcement came only two days following the world’s wealthiest man instructed his employees that they must return to their workplace or quit the business.
Tesla ( TSLA) employed about 100,000 employees in its company and subsidiaries by the end of 2021, as per their Annual SEC filing.
The company has not yet been accessible for comment.
Musk’s brutal warning about a possible recession and its negative impact for automakers is the most precise and prominent prediction of this kind in the auto industry.
Although concerns over the possibility of a recession are growing and so has the demand for Tesla automobiles as well as other vehicles powered by electricity has been a solid and a lot of conventional indicators of a slowdown — such as the rise in inventories of dealers within the United States — have not come to fruition.
However, Tesla has been unable to get back into manufacturing at their Shanghai plant after the lockdowns of Covid-19 forced costly shutdowns at the factory.
Musk’s downbeat outlook is echoed in recent remarks from executives, including JPMorgan Chase ( JPM) CEO Jamie Dimon and Goldman Sachs ( GS) President John Waldron.
The “hurricane is right out there down the road coming our way,” Dimon declared this week.
The rate of inflation in the United States is hovering at 40-year-highs and has led to an increase in living costs for Americans as the Federal Reserve faces the difficult task of reducing demand enough to stop inflation, without leading to the possibility of a recession.
“Put off all hiring”
Prior to Musk’s announcement that was sent in an email that reads “pause all hiring worldwide,” Tesla had around 55,000 job ads posted on LinkedIn from sales representatives in Tokyo and engineers at the company’s new Berlin gigafactory as well as deep-learning scientist located in Palo Alto.
Musk’s request that employees return to their offices has been met with opposition in Germany.
“Everyone at Tesla is required to spend a minimum of 40 hours in the office per week,” Musk wrote in his email on Tuesday. “If you don’t show up, we will assume you have resigned.”
Musk was also involved on Thursday in an Twitter fight in a Twitter spat Australia technology billionaire as well as Atlassian ( TEAM) co-founder Scott Farquhar, who ridiculed the policy in a series of tweets describing it as “like something out of the 1950s.”
Musk tweets: “recessions serve a vital economic cleansing function” in response to a tweet from Farquhar who had urged Tesla employees to research remote work opportunities.