Tesla layoffs will impact staff at Gigafactory near Reno | nnbusinessview.com

Tesla layoffs will impact staff at Gigafactory near Reno

Tesla Gigafactory east of Reno-Sparks in Storey County employs roughly 7,000 people and is among reasons why Nevada's business climate is changing.
Courtesy Tesla

RENO, Nev. — It is unclear how many jobs at the Tesla Gigafactory will be impacted by the announcement on Friday, Jan. 18, that the electric car mega-company will cut 7 percent of staff as it bolsters efforts to build more affordable vehicles.

A Tesla spokesperson confirmed to the NNBV Friday afternoon the cuts would affect the Gigafactory. However, when asked to reveal specific impacts to employees there, the spokeswoman declined to share any numbers.

The 1.9 million-square-foot factory, located east of Reno-Sparks in Storey County, manufactures electric batteries for home power supplies and vehicles, including motors for the Model 3, Tesla’s cheapest vehicle at $44,000.

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Tesla CEO Elon Musk said in a letter to staff Friday that Tesla needed to reduce the price of its Model 3 to $35,000 this year in order to broaden its customer base and “still be a viable company.”

“Looking ahead at our mission of accelerating the advent of sustainable transport and energy, which is important for all life on Earth, we face an extremely difficult challenge: making our cars, batteries and solar products cost-competitive with fossil fuels,” Musk said in the letter. “While we have made great progress, our products are still too expensive for most people.”

According to the Associated Press, the company delivered more than 245,000 electric cars and SUVs last year, nearly as many as all previous years combined. But it still felt short of a goal set nearly three years ago of manufacturing 500,000 vehicles for the year.

Tesla currently has about 45,000 employees, the AP reported, meaning roughly 3,150 employees will be losing their jobs.

“To those departing, thank you for everything you have done to advance our mission,” Musk said in the letter. “We would not be where we are today without you.”

Tesla’s job cuts comes less than two months after the Nevada Governor’s Office of Economic Development issued a report showing that there were 7,059 people working at the Gigafactory.

The job creation reportedly exceeded Tesla’s and Panasonic’s promise to the state that it would employ 5,000 people at the factory, according to the GOED report.

GOED officials also said the Gigafactory, with an average hourly wage of $25.78, generates an annual payroll of $378.6 million and an estimated economic impact of $2.2 billion.

News of Tesla’s layoffs brought the company’s shares down 13 percent on Friday, according to MarketWatch.