What do you think about Tesla cutting salaried headcount by 10%?
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There is no misunderstanding by investors. Daytraders look for any excuse to drive the price down, because they make the most money on the volatility.
And Musk keeps giving them the chance to do it
If one day I would be 10% as calm and forward looking as Dave, I’d be supper happy with that achievement. A voice of reason in a sea of noise.
@Dean Truitt he is already up 250x his initial
meditate
@Alexandre Forget That is the best way to keep calm and reduce stress.
If you can meet with Triumph and Disaster
And treat those two impostors just the same.
Picked up some more at 711
With his level of wealth you would probably be.
Thank you for the presentation. Not to get rid of the fat is not a good move.
In most corporations you could fire your bottom 25% and be just fine. Particularly after everyone was working from home and underproducing.
This is such a bs argument. Newsflash to you, poeple who didn’t work from home, also didn’t work at the office. Furthermore it shows, that the exec have 0 trust in their staff.
Great point Brian N.
Yup. I’ve had to replace boomers who retired that were making more money than me by virtue of having decades more tenure and raises stacked up. And there was really no additional work to deal with, which made me seriously question what they were doing all day.
This has been the case almost every time whenever someone retired, and new hires were brought on only a small fraction of the time.
I can only conclude that a lot of office jobs are BS bloat that no one really needs.
The reality is that every company could probably benefit from dumping the bottom 10% every 2 (?) years.
The problem is identifying that 10%
He’s using economy as excuse to remove slackers
Dave you always try to find good things in Elon and carefully avoid discussing any risks. I am also a Tesla investor and it would be helpful if you discuss and analyze risks also.
I agree with this sentiment. When I never hear discussion of risks, I usually wonder what the motivations of the speaker are.
Yeaa… what ever Elon said Dave always support.. a fan boy… he is holding a lot of share…
I actually agree with Elon on this, he’s decreasing supervisors, increasing producers. Its exactly the opposite move most OEMs do, held down by their bureaucracy and supervisors.
Gotta minimize the bullshit jobs, until full automation they won’t be able to completely eliminate them. They just try to stomp them out where possible.
Lol……… wasn’t tesla floating in money!? That’s what I tough 😂 😂
@Franklin automation will never entirely replace humans! That’s a fact! There is also quality control super lacking at tesla…..
Elon is being a total douch-e against his employees. I really dislike what he’s doing.
Timestamps episode #607:
00:18 News articles inaccurate
00:48 1st email sent to executive management pausing hiring of salaried positions
1:22 2nd email to all states “Hourly Headcount will Increase”
2:00 Ten percent reduction in salaried positions more than offset by increase in hourly production workforce (2:22 Gary Black estimates, 2:44 Reuters article)
3:15 Why layoffs are necessary
4:19 Downsides to layoffs
4:40 Elon Musk not afraid to make hard decisions (keep OPEX lean, maintain work ethic, prepare for global recession)
5:36 Elon’s reported “bad feeling about the economy”?
6:00 Summary — Long-term good news for investors
This is how Elon thinks if you don’t make anything you have to really prove your place.
I think the first message about no work from home was to begin to clean house a bit. Now come the layoffs. It’s never fun to let people go but hopefully this will allow them to run leaner and more efficient.
This is no surprise. I’ve been holding on purchasing stocks waiting for the obvious recession coming. Everyone should been holding!
when it’s “obvious” the recession is coming many people hold lots of cash like yourself. sets up the the market to rebound quickly when people see recovery coming (crash never happens)
Always with the level headed and layer pealing analysis.
You’re the man, Dave.
Sounds like Elon is making an emotional decision, not a business one. Yesterday he ended work from home. Sounds like some company situation really made him angry (a group that worked from home, likely) and he is lashing out. If they are truly growing at an exponential pace, he is going to need experienced supervisors. What they need more than layoffs in an Eastern US Giga factory.
Absolutely agree with you, Dave. Just like in 2018 reduction at Tesla was very healthy for the company and about a year later also for the stock! 😉
Dave has a good points as always.
IMO, Tesla, are actually thinking that they aren’t going to be moving as many vehicles and that demand may dry up. AFAIK, a lot of people have been coming out and saying,
we didn’t think inflation was going to be this bad. A recession by the 3rd Q would not surprise me.
On the “show up for work in person or pretend to work somewhere else”, IMO, working remotely is the future. Already in Australia, they are hiring Americans, Europeans and other non Australians who could not work in person in Australia because entry is difficult. Working remotely gives an employer the entire world as their recruiting grounds.
10% in the most expensive part of operating expenses, executive pay. This is an increase in efficiency and a boost to the bottom line. In addition, this is a reduction in salaried employees, which could possibly mean a shift from salary to hourly? This is all a smart move to boost profitable and avoiding waste. Super bad feelings is not exactly a data driven, scientific reaction, but an emotional one… However, I’d trust Elon’s gut over anyone else in business or government. Seeing the stock beat up today seems silly and overreacting. They still sell every car they make. I’d be curious to seeing all the model updates with this boost to the bottom line. This guy is brilliant at allocating and re-allocating capital.
Thanks Dave for the insight and clarifying those misleading headlines. These “news sources” are so quick to post anything negative regarding Elon or Tesla.