Yahoo Autos Elon Musk Apologizes For Underpaying Laid-Off Workers But Still Demands His Own $56 Billion Pay Day
Good morning! It’s Thursday, April 18, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Elon Musk Actually Apologizes For Something
Elon Musk said some of the severance packages received by recently laid-off Tesla employees when it cut 10 percent of its staff were too low. Right now, it isn’t clear how many employees were affected by the far-too-low severance packages. From Bloomberg:
“As we reorganize Tesla it has come to my attention that some severance packages are incorrectly low,” Musk said in a short email sent to employees on Wednesday and seen by Bloomberg News. “My apologies for this mistake. It is being corrected immediately.”
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The email is a rare show of contrition from Musk, who’s contending with lawsuits brought by former Twitter employees and executives over severance. Earlier this week, the billionaire announced Tesla would slash global headcount by more than 10% as the carmaker struggles with slowing demand for electric vehicles.
In typical Tesla fashion, the job cuts were done in anything but a smooth manner. We recently reported how some employees didn’t find out they were laid off until trying to use their key cards at Tesla facilities.
“Tried to badge in, and the security guard took my badge and told me I was laid off,” Nico Murillo, a former production supervisor, wrote on LinkedIn. “Sat in my car in disbelief.”
Some departments were hit harder than others, according to Bloomberg. Apparently, some divisions saw cuts closer to 20 percent.
Following the layoffs, a number of senior executives, including Drew Baglino, senior vice president of powertrain and electric engineering and Rohan Patel, vice president of public policy and business development, resigned from the automaker.
2nd Gear: Rivian Cuts Another 1 Percent Of Its Workforce
Rivian is carrying out its second round of layoffs this year. Now, another 1 percent of its workforce is heading to the chopping block as the nascent automaker deals with lower-than-expected customer demand. From Bloomberg:
“We continue to work to right-size the business and ensure alignment to our priorities,” the company said in an emailed statement. “This was a difficult decision, but a necessary one to support our goal to be gross margin positive by the end of the year.”
The move comes about two months after Rivian slashed 10% of its salaried staff as high interest rates and economic headwinds compounded the company’s ongoing challenges with scaling production. The prior round of cuts focused on product teams and those working on its commercial EV business, while the latest move will mostly affect support and back-office workers.
As of December 31, Rivian had a 16,790-person headcount across the company. Some simple math would suggest a 1 percent cut means about 150 to 160 jobs are being eliminated.
It’s a tough time for EV makers right now. I mean, Tesla, the biggest one of them all, just had to cut 10 percent of its staff, and you’d know that if you read First Gear.
