Investing.com – Tesla Inc (NASDAQ:) employees are worried that the electric vehicle maker plans to lay off most of its staff as it grapples with worsening sales, separate reports from Business Insider and Electrek showed.
Both reports showed that rumors were circulating at Tesla offices, particularly at the Texas Gigafactory, that the electric car maker could announce layoffs as soon as this week. Workers were also concerned about layoffs at the Fremont plant.
A report from Electrek says layoffs could be as high as 20%, and Business Insider reports that Tesla has already cut production shifts for the Cybertruck.
The reports come as deliveries from the world’s most valuable automaker slumped in the first quarter as demand weakened and competition intensified in China, one of its biggest markets.
Global demand for electric vehicles has weakened as customers cut back on large purchases amid worsening economic conditions. The resurgence in popularity of hybrid models over the past year has also impacted demand for electric vehicles.
Earlier this year, Tesla tasked managers with identifying the most important roles within the company. The electric vehicle maker has also reportedly delayed some performance tests.
Over the past year, Tesla has cut the prices of its cars, especially in China, to boost demand. But this gave only limited sales growth.
The electric vehicle maker has set weaker production targets for 2024 amid weaker demand and has also reportedly canceled plans to produce a low-cost electric vehicle.
But Tesla has also touted plans to expand its self-driving technology and artificial intelligence to offset the decline. CEO Elon Musk recently said that the electric vehicle maker’s first robotaxi will be unveiled this August.
Musk also blamed much of the sales decline on high interest rates and a weakening global economy.