Elon Musk backtracks on job cuts, says Tesla salaried staff to be ‘fairly flat’

Tesla Inc (TSLA.O) Chief Executive Elon Musk said on Saturday that the electric vehicle maker’s total headcount will increase over the next 12 months, but the number of salaried staff should be little changed, backtracking from an email just two days ago saying that job cuts of 10 per cent were needed.

“Total headcount will increase, but salaried should be fairly flat,” Musk tweeted in a reply to an unverified Twitter account that made a “prediction” that Tesla’s headcount would increase over the next 12 months.

Musk in an email to Tesla executives on Thursday, which was seen by Reuters on Friday, said he has a “super bad feeling” about the US economy and needed to cut jobs by about 10 per cent.

In another email to employees on Friday, Musk said Tesla would reduce salaried headcount by 10 per cent, as it has become “overstaffed in many areas.” But “hourly headcount will increase,” he said.

Tesla’s shares sank 9.2 per cent on Friday on the news.

According to a Tesla US regulatory filing, the company and its subsidiaries had almost 100,000 employees at the end of 2021.

Ahead of his emails on staffing levels, Musk on Wednesday in an email to Tesla employees issued an ultimatum to return to the office for a minimum of 40 hours a week. Failure to do so would be taken as a resignation, he wrote.

Musk on Thursday said Tesla’s AI day has been pushed to Sept. 30, and said a prototype of Optimus, a humanoid robot that is a company priority, could be ready by then and could be launched next year.