Thursday , July 29 2021

The Teslin supplier team has destroyed the source in recent job cuts

Tesla said that this quarter focuses on delivering cars to customers waiting in China and Europe.

Model 3 sedan Tesla Inc. Image: Twitter @Tesla.

SAN FRANCISCO – When Tesla Inc. announced the second round of cuts in jobs last month to keep costs down, one of the important departments was particularly affected. The car has more than halved the division that brings its electric vehicles to North American customers, two of the redundant workers said.

Approximately 150 workers in the group of about 230 were fired in January at a plant in Las Vegas, which gets ten thousand models 3 in the hands of US and Canadian customers, said the company expects the pace of delivery in the near future slowed down considerably.

Reductions that have not yet been reported could be a source of concern for investors that the demand for model 3 in the United States ended when last year a huge tax relief for consumers was passed and that the car is still too expensive for most consumers.

Tesla said that this quarter focuses on delivering cars to customers waiting in China and Europe.

"Not enough supplies," one of the former employees told Reuters. "You do not need a team because there are not so many cars."

The delivery of the 3 model was a key priority for the company in the second half of 2018, as Tesla tried to cut all the customers who wanted to take full advantage of the tax deductions of US $ 7,500 to half the year before the end of the year.

Model 3 is crucial for Tesla's long-term profitability plans. The company intends to generate profits in each quarter this year on the basis of the expectation that it will sell more models 3 and continue to lower costs.

Tesla did not want to comment on the reduction in the number of posts in the delivery team. The company still has an undisclosed number of suppliers in other locations.


Even before the release of the delivery group, investors questioned the level of demand for model 3, which remains after Tesla's universal pressure to ensure that purchasers provide supplies before lowering the tax relief.

"Given the need for revenue to cover costs and generate cash, the financial community should focus on the level of demand for Tesla vehicles – especially model 3," said Barclays analyst Brian Johnson in January.

Two former delivery workers said that sales in 2018 left Tesla's reservation list cleansing North American buyers who are willing to pay the current price of more than $ 40,000 in order to acquire Model 3.

Executive director Elon Musk initially said that the car would start at $ 35,000 in 2016, triggering faster reservations, but Tesla has not actually sold cars at this price, despite two price cuts this year.

"We sold almost every car we had on the ground, and we invited almost every creature on a planet that has ever expressed the desire to have Teslo to tell them that the tax credit expires," said another former worker.

Tesla employees around the company were transferred to join, said this source.

"They said, 'Your job is now outside the table, we have to deliver these cars. Because if we do not deliver these cars, tomorrow you will not have work, "said the former employee.

Half a million customers

On the model 3, launched in July 2017, Musk said that more than half a million customers had deposited new cars. This in the next six weeks helped to increase the Tesla share by almost 15 percent.

In 2018, the company delivered 145,610 3s models, all at prices that were well above $ 35,000. Musk said last week that $ 35,000 could be sold profitable for six months. Even with two price reductions this year, the lowest price on the model 3 is now $ 42,900.

Musk argues that demand for the 3 model is "crazy high", but his company did not publish any data that would prove this.

When asked about the last week's list of analysts, outgoing Chief Financial Officer Deepak Ahu refused to reveal how many people remained and labeled him "not important".

Musk said that Tesla has several ways to relax demand if he chooses to do such as offering leases or increasing market efforts.

Model 3, now introduced from the Tesla Fremont factory in California, will be dedicated to Chinese and European customers, says Tesla.

Two dismissed workers said that delivery targets for North America, mostly US buyers, would amount to between 55% and 60% in the same quarter of the same period last year as in the last quarter of 2018.

If Tesla will not soon lower prices, it will lose potential customers – and those already in the list of reservations – to many German and Asian competitors whose electric vehicles this year will be on the US market. Each of the first 200,000 new entrants will be eligible for the entire federal subsidy.

After this figure has already been reached, the US tax credit for Tesla customers in the first six months of 201 is reduced by half to $ 3750, and then halved by half in the second half of the year.

Musk said last month that it would be a "rough" belief that Tesla would start building the $ 35,000 model in mid-2019.

One source said he could replenish American demand: "If the Model 3 for 35,000 dollars, which was still a really good car that would blow up competition, I could see demand through the roof."

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