The electric vehicle-making company Tesla Inc. is now making lots news in the business industry since the company has decided to cut off seven percent of its employees. However, experts believe the company must’ve taken this decision to build a mega-factory in China which is costing the company more than $ 2 billion. There are many speculations right now going on in the market regarding Tesla because of the company’s decisions of cutting its workforce. Some experts believe that the company’s debt has increased more than $1 billion benchmarks and that could be the reason why it is now cutting so many of its employees. Tesla has always faced the problem of running out to liquid funds in the past also because at one point the company was on the verge of bankruptcy and it seems like the company is in the same situation again.
Tesla Inc. still owes approximately $1 billion of debts, and the company’s shares are also not performing well from the last couple of few months. Now it can be presumed that the company is trying to save the fund by cutting off its workforce and Elon Musk wrote a letter to its employees in which he stated that the company is operating with more employees than it requires and that’s why they have decided to take this decision of laying off employees. Musk said that this decision was necessary for the company’s Model 3 production since Tesla is running out of cash to invest more in the production of their upcoming electric cars.
Now, many people are criticizing Elon Musk for this situation because they think that it was Musk’s decisions due to which company invested so much of its funds into unsuccessful products. However, it seems like the problems for Elon Musk are not going to end that much easier.