I've owned two Teslas and have been very enthusiastic about the product, which I still feel is outstanding. However, Tesla now seems very unfocused, and its goals are unclear. Laying off entire teams, including the Supercharging Team, HR, Product Development, and Engineering, clearly shows the company is no longer looking forward, using innovation to generate growth; they are attacking G/A spending in a way that reflects significant impacts on top-line revenue and retreating from investments in human capital.
Looking on the other side of the issue, as financial statements sometimes don't tell the whole truth, and seeing the massive construction that has been ongoing at Giga Texas, there could be serious treasury-related issues related to investments in the 4680 batteries, where the return on capital that was planned and forecast efficiencies in manufacturing never materialized. This very well could have placed Tesla in a very serious cash crisis, thus making the draconian cuts necessary for its survival and necessitating realigning G/A for new financial projections.
Being competitive and continuously innovating is the only way a company can prevent its extinction. While excesses must continually be trimmed and redundancies are sometimes necessary to align top-line with EBITDA targets, you can't stop innovating as the savings achieved now are wiped out by the capital required to regain momentum in the future. The damage to both customer and employee goodwill is difficult to restore, and I suspect these latest cuts will benefit the UAW and their efforts to unionize Freemont and Texas.
Yes, and:
Elon still tries to run Tesla like a start-up.
Wants fast action, quick decisions, and rather than expanding the company into a larger, more stable entity, he pulls an Elon.
He sees a department he can eliminate because he wants other OEM's to pick up what Tesla got started, and he can take the payroll/resources and direct it toward another project.
It's what a small startup does. But at a certain size, it becomes detrimental to the stability of larger, public, corporations.
Shareholders would prefer slow, small, incremental growth that is more predictable.
Elon is great a startups. He's done it successfully many times. But IMO, he has yet to show the ability to build a company, and then put people in place to take it to the next level, because he can't let go enough to allow anyone else to run things.
Because, of course, no one else thinks like him.
Look at Twitter. That's an example of an established company, and he orchestrates essentially a hostile takeover, and immediately begins to start running it like a startup. And we all saw how that went initially.
So Tesla is at this inflection point. He needs to step back and trust people (he can choose) to run things. He doesn't have to disappear, just be less hands-on in the daily things. Go to the big picture, big project, meetings. Make sure his overall plans are in track. Then go find some smaller startup-like project to work on.
If the Supercharger department was going to be dissolved, that's fine. I think other companies would have handled it much differently.
They might have seen if any of that talent could be kept in-house by changing departments. They probably would have given them a heads up about the dissolution of the department, giving them at least a couple of weeks to line up new positions elsewhere. I'm sure they got a decent severance, so I'm not that worried about them. But it's all about the perception and the image left in people's minds when Elon sends an email to fire an entire department. Then, I think I saw somewhere (X post: grain of salt) he's already saying they may hire select people back. Well, that's what you pay an HR department for, as I mentioned above, those evaluations could have been done before and they could've been retained, either in a modified role, or transferred to another department.
His startup mentality is move fast, break things. He certainly has the arrogance to believe that everyone would want to work for Tesla. And to an extent, he's probably right. But ask anyone in management and they'll tell you, it is FAR easier to keep a good employee than it is to replace one, no matter how sought after you think your company is.
And keep this in mind, if you continually bring in the best people, then discard them when you're done. Eventually, you run through all the "best" people, and you're left with the "rest", because none of the best will want to work for you when you've acquired the vampire reputation.
