Tesla closes office after laying off autopilot jobs, including hourly jobs

SAN FRANCISCO, June 28 (Reuters) – TESLA (TSLA.O) It closed its San Mateo, California office and laid off nearly 200 employees working on the autopilot’s automated co-pilot system there, one person told Reuters, in a move seen as a cost-cutting acceleration.

That person said most of the laid-off were hourly workers.

Earlier this month, Tesla CEO Elon Musk told top managers he had a “very bad feeling” about the economy and that the electric car maker needed to cut staff by about 10%. Read more

Later, the billionaire said the 10 per cent cuts would only apply to salaried workers and that the number of hourly employees was still expected to increase. Read more

“It’s clear that Tesla is in a great position to cut costs,” said Raj Rajkumar, professor of electrical and computer engineering at Carnegie Mellon University. “This (staff reduction) likely indicated that the second quarter of 2022 was very difficult for the company due to the shutdown in Shanghai, raw material costs and supply chain problems.”

Anti-epidemic measures in Shanghai have reduced Tesla’s production there.

The laid-off person, who spoke to Reuters, said workers at the satellite office had previously been told they would move to an office in Palo Alto in phases beginning this month after the San Mateo lease expired. But most workers were laid off on Tuesday.

“It was definitely some kind of sedation,” he said. “Yes, we were certainly shocked; we are certainly shocked.”

Some workers expected Tesla to shift some jobs to low-wage workers in Buffalo, New York, to save costs.

Tesla did not immediately respond to a Reuters request for comment.

Several people in Tesla’s San Mateo office work on data annotations — reviewing and categorizing various visual images collected from Tesla vehicles to teach the cars’ autopilot system how to handle certain types of road scenarios.

A number of Tesla data annotations employees on Linkedin said Tuesday that they have been laid off.

“It was kind of a disappointing day today. I laid myself off along with almost the entire San Mateo branch of Tesla,” Caeser Rosas, data annotation specialist, said on Linkedin.

Bloomberg first reported the job cuts in San Mateo.

Musk also said Tesla’s new plants in Texas and Berlin were “huge money furnaces” losing billions of dollars. Read more

Reporting from Hyunjoo Jin; Editing by Bradley Perrett

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