By 2028, GlobalData forecasts that EVs will account for 28% of total light vehicle production. Credit: Iv-olga/shutterstock

Electric vehicle maker Tesla will cut around 10% of its workforce, according to an internal memo by CEO Elon Musk. 

In line with Tesla’s most recent headcount at the end of 2023, approximately 14,000 people could be affected. 

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In the memo, Musk cited cost reductions and role overlapping as the main motivations behind the proposed layoffs. 

The memo was first reported by Bloomberg and Electrek. Following the news, two of Tesla’s senior vice presidents departed the company. 

Rohan Patel, Tesla’s VP of public policy and business development, confirmed his departure in a statement to TechCrunch stating that he wished the company well.

Drew Baglino, Tesla’s SVP of powertrain and energy, posted on X that he was departing the company.

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“I am so thankful to have worked with and learned from the countless incredibly talented people at Tesla over the years,” he wrote, stating that it was his decision to leave the company after 18 years. 

The layoffs and departures came shortly after Tesla’s Cybertruck orders fell short of expectations. 

In Q1 2024, Tesla stated that it had only sold 386,000 Cybertruck units, despite producing over 430,000. 

Explaining this decline in sales, Tesla stated that it had faced factory shutdowns as a result of the Red Sea conflict which began in October 2023 and an arson attack at its Berlin Gigafactory. 

The suspected attack occurred in March 2024 and Germany’s federal prosecutor is investigating potential suspects. 

Tesla also stated that the production of its updated Model 3 had affected sales and production of its Cybertruck. 

In its 2023 thematic intelligence report on electric vehicles (EVs), research and analysis company GlobalData noted that electrification had disrupted automotive leaders, making EV startups swell to meet the initial demand for EVs. 

By 2028, GlobalData forecasts that around 28.3 million annual EV units will be produced, accounting for around 28% of total light vehicle production.