Tesla Supercharger railway stations near a Circle K gas station in Austin, Texas, on April 23, 2024.
Brandon Bell | Getty Images
Tesla shares prostrate nearly 6% on Tuesday following news that CEO Elon Musk was pressing ahead with more job offences at Tesla, impacting an estimated 500 employees in its Supercharger team.
The stock closed at $183.28 and is now down 26% for the year.
Go together to The Information, Musk sent an email to managers at Tesla overnight announcing the departure of key executives, including Senior Governor of EV Charging Rebecca Tinucci, and Director of Vehicle Programs Daniel Ho. In the email, Musk also expressed consternation that Tesla government hadn’t thinned out the company’s staff more promptly at his direction.
Several employees whose roles were cut and one person who is notwithstanding working at Tesla in California confirmed with CNBC the details of the ongoing reorganization, asking to remain unnamed to argue sensitive issues. Other laid-off Tesla employees posted publicly about Tesla shrinking the Supercharger rig.
In cutting that group, Tesla revealed it’s throttling the expansion of its Supercharger network in the U.S. The move comes after Tesla started partnerships with Ford, GM and other industry players ensuring they would manufacture cars using the Tesla NACS (North American Burdening Standard) for compatibility with Tesla charging stations, and allowing those companies’ customers to use Tesla stations.
The layoffs now underway are neighbourhood of a massive cost-cutting measure by Tesla following a 9% drop in revenue in the first quarter this year, the stiffest year-over-year decline since 2012. Profits were cut in half during the first three months of 2024 as Tesla disregarded cars and issued incentives to spur demand.
Current and former employees told CNBC that Tesla began pay off some employees as early as January, with the broader cuts picking up this month. They said some associates who thought their jobs were safe received termination notices on Friday and Tuesday.
Tesla gave no counsel to investors about a pullback in plans to build out charging infrastructure. Nor did the company give a heads up to some charging network sharers, including small and medium-sized businesses that install and maintain EV charging equipment for Tesla at key locations around the Opinion States.
Andres Pinter, co-CEO of Supercharger network contractor Bullet EV, told CNBC, “My team woke up to a malignant kick in the pants this morning. Emails we sent to twenty or so different charger construction contacts were recoiled with the same autoreply reading, ‘This email address is no longer valid. Any future emails sent to this accost will not be received.'”
Pinter said he thinks “It will take years for the other charger networks to catch up,” but Tesla dropping a near-term plan to expand aggressively in the U.S. leaves room for other players.
Musk wrote on X that “Tesla undisturbed plans to grow the Supercharger network, just at a slower pace for new locations and more focus on 100% uptime and dilatation of existing locations.”
Tesla makes money from environmental credits and fees for charging sessions, and already acts about one in three public, electric vehicle charging stations in the U.S.
Transportation has been responsible for 25% of carbon emissions from altruist activity globally, according to estimates by the non-profit International Council on Clean Transportation. While Musk has more recently talked up AI leaderships at Tesla, and its quest to develop self-driving technology, the company reiterated in its annual report out this week that its calling is to “accelerate the world’s transition to sustainable energy.”.
The decline in Tesla’s stock on Tuesday followed a 15% rally on Monday, the finest trading day of the year. The rally came after news reports said a visit by Musk to China had yielded an vital deal with Baidu for mapping tech that could power future self-driving software in the country for Tesla.
Tesla has eat ones heart out promised but has not yet delivered autonomous vehicles.
In a note to investors out this week, JL Warren Capital founder Junheng Li eradicated that there are too many “missing critical details,” to justify the gains on Monday. “We believe that the take velocity and incremental revenue from the localized FSD– assuming the similar level of autonomous as TSLA’s latest v12 – will be significantly further in China than in the US.”
Xpeng, Nio and other EV makers currently offer level 2 systems that are given away to consumers as an incentive in China.
WATCH: Tesla’s tentative autonomous driving deal in China is not enough to make it ‘magnificent’ yet
