Tesla Is Closing Its San Mateo Office, Laying Off 229 Employees, Filing Shows

CEO Elon Musk had earlier expressed his concerns about the economy and mentioned that layoffs were inevitable.

Tech and Auto
2 min read
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Edited By :Ahamad Fuwad

A California regulatory filing has confirmed that electric carmaker Tesla is laying off 229 employees from its San Mateo office and shutting down the branch.

According to the filing, which was accessed by Reuters, the laid-off employees are annotation workers who belonged to Tesla's Autopilot team. They worked on the company's vehicle automation and advanced driver assistance features.

Tesla is led by billionaire Elon Musk, who is being sued by Twitter for pulling out of a $44 billion deal to purchase the social media company.


The regulatory filing that confirmed the layoffs was a notice filed in compliance with the Worker Adjustment and Retraining Notification (WARN) Act, which requires US companies to give workers a 60-day notice when conducting layoffs.

According to the filing, most of the workers were in moderate-skill, low-wage jobs and were paid by the hour. These employees worked on tasks such as Autopilot data labelling, which involves determining if Tesla's algorithm identified an object well or poorly.

The San Mateo office, which employs 276 workers, is being permanently shut down, following which the remaining 47 workers will be transferred to Tesla's Buffalo Autopilot office.

‘Super Bad Feeling’ About the Economy

In June, the company's CEO Elon Musk expressed his concerns about the current economic situation, detailing his plans to lay off employees in order to cut costs.

Reuters reported that Musk had sent an email to the top Tesla executives, mentioning that he had a "super bad feeling" about the economy and that the company would have to cut their salaried workforce by 10 percent.

The billionaire later confirmed this at the Qatar Economic Forum where he also mentioned that the layoffs would only affect salaried employees and that Tesla's total headcount would be reduced by 3.5 percent.

The layoffs apparently came as a surprise. One of the employees who was laid off from the San Mateo office told Reuters that they and their peers were informed earlier that they would be moved to the Palo Alto office in stages.

Tesla is currently facing a class-action lawsuit from its former employees. Tesla fired over 500 employees from its Nevada Gigafactory in June. The former employees soon sued the company, alleging that they were not given the prerequisite 60-day notice as per the WARN act.

Raj Rajkumar, a professor at Carnegie Mellon University, told NDTV that Tesla has had a difficult second quarter this year and that COVID-related shutdowns in Shanghai have led to supply chain problems and raw material shortages.

Rivian Automotive, an electric truck company, has also hinted at possible layoffs. The company's CEO RJ Scaringe said in a company-wide email that Rivian is "not immune to the current economic circumstances" and that the company needs to prioritise certain programmes over others in order to grow sustainably.

(With inputs from Reuters, Bloomberg and NDTV)

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Topics:  Tesla   Elon Musk   Recession 

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