Why are layoffs always seen in a bad light.
Sometimes what you need is to trim the fat.
Sometimes what you need is to trim the fat.
If the company is doing mass layoffs on top of that then it pretty much always means financial trouble. And these layoffs tend to affect the talent that you want to keep.
When the big tech companies have been doing mass layoffs, the vibe amongst the workers and on here has always mostly been: but they're making so much profit!
The reality is that an astute and strategic CEO/board will do layoffs as a last resort in order to steer a company through troubling times ahead. Tesla forecast a large drop in 2024 EV sales, which is now happening. They didn't do the layoffs until their forecast turned out true.
Now if Tesla is really alreadly slicing that close to the bone (like Microsoft when it used to cut 10% every year), then it could be detrimental. But if I had to bet w/o any inside knowledge, I'd guess the 10% cut is still not going to hurt that much, and could be a boost.
It's a different story though when a labor intensive manufacturer with a 50% projected growth is laying off people...
Yes, every time you starve you need to do it.
This layoff, like most, seems more driven by top line sales and stock performance than individual worker performance. I doubt 10% of Tesla's workforce just happened to turn into "fat" shortly after a brutal earnings report.