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Tesla closes an office as layoff affects Autopilot jobs, including hourly ones

Tesla closes an office as layoff affects Autopilot jobs, including hourly ones
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SAN FRANCISCO, June 28 (Reuters) – Tesla (TSLA.O) closed its office in San Mateo, California, and laid off about 200 employees who worked there on its Autopilot driver assistant system, one of the people told Reuters, in a move seen as accelerating cost-cutting.

Most of those laid off had been hourly workers, that person said.

Earlier this month, Tesla Chief Executive Elon Musk told senior managers he had a “really bad feeling” about the economy and that the electric-car maker needed to cut staff by about 10%. read more

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The billionaire later said the 10% cuts would apply only to salaried workers and the number of hourly employees was still expected to rise. read more

“Tesla is clearly in major cost-cutting mode,” said Raj Rajkumar, a professor of electrical and computer engineering at Carnegie Mellon University. “This (downsizing) probably indicates that the second quarter of 2022 has been quite tough for the company due to the closure in Shanghai, raw material costs and supply chain issues.”

Anti-pandemic measures in Shanghai have depressed Tesla’s production there.

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

Tesla vehicles are displayed at a sales and service center in Vista, California, U.S., June 3, 2022. REUTERS/Mike Blake/File photo

“It was definitely a little numbing,” he said. “Yeah, we’re definitely shocked; we’re definitely surprised.”

Some workers hoped that Tesla would shift some of the jobs to lower-wage workers in Buffalo, New York, to save costs.

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

Many people in Tesla’s San Mateo office work on data annotation, reviewing and tagging various images collected from Tesla vehicles to teach the cars’ autopilot system how to handle certain types of road scenarios.

Several Tesla data entry employees said on Linkedin on Tuesday that they had been fired.

“Today was a bit of a disappointing day. I, along with almost the entire San Mateo branch at Tesla, just got laid off,” Caeser Rosas, a data annotation specialist, said in a Linkedin post.

Bloomberg first reported the job cuts in San Mateo.

Musk has also called Tesla’s new factories in Texas and Berlin “giant money ovens” losing billions of dollars. read more

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Information from Hyunjoo Jin; Edited by Bradley Perrett

Our standards: The Thomson Reuters Trust Principles.

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