Tesla laying off 9 percent of workforce

Seeing Tesla Improving Production Rate: Keybank

Seeing Tesla Improving Production Rate: Keybank

Afterward an emotional Musk appeared to signal brighter days ahead for the Tesla when he predicted the company would begin pushing out 5,000 Model 3s per week by the end of June.

Tesla has announced that it will be cutting around 9% of its workforce as part of a restructuring move to reduce cost, Autocar reports.

Tesla said the more than 3,000 cuts would affect mostly salaried employees, excluding workers producing its cars. The company will also not renew its contract with USA hardware chain Home Depot, which now sells the company's solar panels and home energy systems, though "the majority" of Tesla staff now placed in Home Depot stores will move over to Tesla retail positions.

Musk conceded that Tesla has not made an annual profit in 15 years.

The cuts are nearly entirely made from salaried employees.

Tesla started 2018 with about about 37,000 employees globally and has hired thousands of employees since then.

Last month, Tesla CEO Elon Musk announced a vague plan to "restructure" the company in order to achieve profitability during the second half of the year.

This latest corporate restructuring doesn't exactly come out of left field as a Tesla spokesperson points out that Musk had expressed intentions on shaking things up during Tesla's first-quarter earnings call. That translates to layoffs of around 3,300 workers.

Keybanc Capital Markets analyst Brad Erickson released a note to investors on Monday, saying that he now expected Model 3 deliveries for the second quarter to hit 30,000 vehicles, versus previous estimates of 20,000.

Elon Musk, Tesla's chairman, said on Twitter that the job cuts were "difficult, but necessary". The letter also explains that the company will not renew its residential sales agreement with Home Depot, as it aims to sell more solar panel and battery storage through Tesla's own online shopfront. It is also concurrent with speculation by many publications that Tesla was about to run out of cash, something its CEO, Musk, had denied. Those who are being let go are being informed of the change this week, we're told, and will be offered salary and stock options based on how long they were with the company.