Tesla Cuts 9% Of 'Salaried Workforce': "Profit Is Obviously Not What Motivates Us"

After being panic bid for the last few days, TSLA shares are rolling over (but still up) after announcing a 9% across-the-company cut of the salaried workforce.

Tesla is careful to confirm that no production associates are being fired and it will not affect the Model 3 production targets.

Bloomberg reports that Musk wrote in an internal memo Tuesday that Tesla’s rapid growth in recent years contributed to “duplication of roles” and the creation of jobs that the company could no longer justify.

“Given that Tesla has never made an annual profit in the almost 15 years since we have existed, profit is obviously not what motivates us,” Musk wrote.

“What drives us is our mission to accelerate the world’s transition to sustainable, clean energy, but we will never achieve that mission unless we eventually demonstrate that we can be sustainably profitable. That is a valid and fair criticism of Tesla’s history to date.”

Full email attached:

We are sure all those who are being laid off are pleased to note that Musk is busily pitching his flamethrowers' success...

For now, the stock is fading off early highs...

 

Additionally, Short interest in Tesla, the most bet-against stock in the US, hit a new record this week of $12.6 billion, according to data from financial analytics firm S3 Partners. That's a 17% increase since May 21, when the previous record was nearly $2 billion less, at $11 billion.

And this is what a short-squeeze looks like...

Comments

I Am Jack's Ma… GunnerySgtHartman Tue, 06/12/2018 - 14:10 Permalink

We tend to think of intelligence as an all or nothing monolith - like, he's smart, or he's a dummy.  But we also can summon the image of the absent-minded genius who can do fantastic equations in his head but can't balance his checkbook or remember how to drive to some restaurant nearby.

I think Teslas look cool.  I think most of them will be off the road within 7 years, which is because they aren't designed, imho, for real road conditions.  Maybe I'm wrong - I hope I am, I'd like to see the company as a whole succeed and expand its sales and staff.

But Musk in most of the relevant ways is an imbecile, and a petulant brat who should not be running a lemonade stand...  he's also, apart from an ego we can excuse, probably not very far from some sort of mental break. Best thing that could happen would be for Musk to stay on in a more limited role.

In reply to by GunnerySgtHartman

jcaz I Am Jack's Ma… Tue, 06/12/2018 - 14:15 Permalink

Cash crunch is here.  He can't afford to pay their salaries, otherwise they'd be down on the floor assembling cars.

No one will loan them money right now,  can't issue more stock while under at least one SEC investigation;

It's coming to a hard place fast.  Rock on the other side.

Poof!  And it's gone....... Mark it zero, dude.

In reply to by I Am Jack's Ma…

bowie28 I Am Jack's Ma… Tue, 06/12/2018 - 14:20 Permalink

Ya think maybe it's not such a good idea to publicly state you are not concerned with making a profit if you're looking for more people to invest or loan you money?

Also, now you're saying you can afford to cut 9% of payroll with no impact on operations which invites the question - why have you been wasting that money all along?  What else are you spending investors' money on unnecessarily while you are running at a loss for 15 years straight?

In reply to by I Am Jack's Ma…

konputa bowie28 Tue, 06/12/2018 - 14:50 Permalink

" Ya think maybe it's not such a good idea to publicly state you are not concerned with making a profit if you're looking for more people to invest or loan you money? "

This statement is likely to become problematic for pension managers that have to be concerned with fiduciary responsibility.

Why the hell are we investing with you if you don't plan to be profitable, etc?

In reply to by bowie28

jin187 Solosides Tue, 06/12/2018 - 17:10 Permalink

Li-ion batteries don't necessarily have that short of a lifespan.  I have many that are over three years old, that have over 1000 charges on them, and haven't had a single one fail yet.  The worst ones I have are probably down to about 70%-80% of their original capacity.  That's with full charge and discharge cycles.  A battery pack in a car might last even longer, since the owner isn't likely to drive the car until it's on "E" like a gas-powered one.  Recharging a Li-ion cell before it reaches 3.3v greatly decreases the strain placed on it, and thus the longevity.

In reply to by Solosides

you_are_cleared_hot I Am Jack's Ma… Tue, 06/12/2018 - 15:04 Permalink

Jack's Ma, spot on pal! could not have said it better myself. " I think most of them will be off the road within 7 years, which is because they aren't designed, imho, for real road conditions" ...you should go check out on youtube "Rich Rebuilds" it firms up your argument that they are not built for real road conditions.  https://www.youtube.com/channel/UCfV0_wbjG8KJADuZT2ct4SA 

In reply to by I Am Jack's Ma…

NurseRatched GunnerySgtHartman Tue, 06/12/2018 - 14:10 Permalink

Solar City is nothing but dead wood.  The parasitic drag of the do-nothing employees @ River Bend in Buffalo has got to end.  The actual Tesla vehicle employees are working - the Solar City chumps are filling their days by rounding up new fantasy football leagues and planning their winter vacations when the plant is shut down.

The Model 3 may actually get its bugs ironed out - but you can't generate demand for over-priced, inefficient solar panels.

In reply to by GunnerySgtHartman

Buckaroo Banzai 1982xls Tue, 06/12/2018 - 14:05 Permalink

I am no big fan of Elon Musk, but ever since he threatened the media kikes, he was marked for destruction. Firing whistleblowers is a time-honored tradition that everyone does and normally never makes the news unless the kikes are out to fuck your shit up. Expect a steady drumbeat of negative news as the Wall Street kikes unload their longs into this short-squeeze, and then short this thing to zero.

In reply to by 1982xls

Yen Cross Tue, 06/12/2018 - 13:56 Permalink

  If the CEO of a company I invested in, ever made a comment like this, I'd close my position yesterday.

  “Given that Tesla has never made an annual profit in the almost 15 years since we have existed, profit is obviously not what motivates us,” Musk wrote.