Despite the mass firings, Tesla is still believed to be looking to hire hundreds more workers as it starts to ramp-up production ahead of the highly-anticipated Model 3's mass roll-out.
Like all companies, Tesla conducts an annual performance review during which a manager and employee discuss the results that were achieved, as well as how those results were achieved, during the performance period. Tesla has said it is still growing its workforce worldwide. Tesla had been aiming to produce 1,500 Model 3 cars by last month and is targeting 5,000 a week by the end of this year. The San Jose Mercury News interviewed multiple former and current Tesla employees who estimated that between 400 and 700 workers lost their jobs. Tesla executives reportedly told Rusch that all of the equipment for the Model 3 production line has now been installed and cars are moving through the line.
Workers in sales manufacturing and administrative roles were fired after the annual reviews were gone through.
While Tesla did not provide statistics, it suggested that its attrition rate this year is roughly similar to last year's rate. Tesla claims that these dismissals are based upon performance and include associates, team leaders, and supervisors.
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CEO Elon Musk said factory output will increase production to a half-million electric vehicles in 2018.
Tesla said the performance-based departures were not considered layoffs and not subject to state notifications. About 450,000 customers have placed $1,000 deposits for the Model 3. The company missed expectations for third quarter deliveries and said that production bottlenecks vastly limited the number of Model 3 cars it could deliver during the quarter.
Quoted by the Mercury News, Michael Harley, managing editor at Kelley Blue Book and Autotrader, thought the dismissals could be an effort to improve vehicle production. The workers reportedly felt like the automaker targeted the former SolarCity division and the Model S and Model X segments, which would make sense if the company is truly concerned about ramping Model 3 production.