Elon Musk has reportedly asked Tesla, Inc. (TSLA) managers to make a ‘binary’ assessment of which roles are crucial to the company. Experts believe that the company plans to mirror the prevailing layoffs in the tech sector as artificial intelligence (AI) makes some jobs obsolete.
Tesla employees up against AI as managers tasked with identifying crucial positions
Based on Yahoo Finance data, Tesla lost approximately $200bn in market value over the past six months, and this move may be one of the measures aiming to revive it. Even though the US Labour Department recorded a general upsurge in hiring new employees, tech job cuts are front and centre as companies increasingly onboard AI and technological solutions.
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The latest Challenger, Gray & Christmas, Inc. report shows that the US-based finance and tech sectors topped the job-cut charts, with 23,238 and 15,806 layoffs respectively. Andrew Challenger, the company’s senior vice president, confirmed the AI-based speculations and said: “These layoffs are also driven by broader economic trends and a strategic shift towards increased automation and AI adoption in various sectors, though in most cases, companies point to cost-cutting as the main driver for layoffs.”
This may explain Musk’s mission to identify essential positions within Tesla. Globally, this company has approximately 140,400 employees and prominent operational sites in Texas, California, China and Germany.
Vaibhav Taneja, the chief financial officer of Tesla, told investors in January 2024:
We are constantly looking for what we can do to reduce costs and the team is constantly going and checking where can we reduce the cost further.
