Alan Ochoa worked at Tesla’s Fremont plant in California for four years. He was laid off recently along with his entire department in quality control, many of whom were also long-time employees. “I have no idea how they expect to run without us,” said Ochoa.
The electric car company releases its latest financial results on Wednesday and analysts are not expecting good news. On 18 January, founder Elon Musk sent out a mass email to employees announcing 7% of the company’s workforce were being laid off, in addition to cuts to temporary and contracted employees, and warning of a “very difficult” road ahead.
Ochoa predicts Tesla’s “difficult road” will not be helped by laying off experienced staff.
He said: “My last repair on Friday was finding a rear fascia was missing a screw so if you pulled on it, it would pop out. I grabbed a drill, the screw, got down on my knees and made the repair myself. No one would have known about it unless they tugged on the edges of the rear fascia like I had made it a habit to do.
“But I know once the car starts driving it would become unseated due to the wind pulling it out.”
An internal document provided to laid-off employees explained those who were dismissed were selected “by evaluating the criticality of each position, identifying duplicate roles, and by assessing the specific skills and abilities of each individual in the company”.
Workers past and present believe Tesla is trying to cut costs by getting rid of more expensive, and experienced, staff. The company disputes this.
Tesla has a one through five pay ranking system for employees. Five represents the most senior.
Anthony Lamendola worked at the Lathrop facility, also in California, for nearly seven years before being laid off.
Lamendola, who was also level five, said: “They let all the people go who have been there level rive or more, all level fours and threes, only kept one, two, some threes. I’ve never been late, never called in, never been wrote up in over six years. I’m just am in shock for them to do this and keep temps and new hires.”
A current Tesla employee at Lathrop who requested anonymity for fear of losing their job, noted temporary employees and recent hires were kept on, while many long-time employees were laid off as part of the cuts. “This was a move I was expecting due to the high price of raw metal from our president’s tariff war with China,” the worker said. “Tesla Lathrop has a large amount of people that wanted to go union.”
Back at the Fremont plant, a current employee who has worked for over four years at the plant was transferred to work on car seats as part of restructuring. He noted many transferred employees took hourly pay cuts, and a few walked off the job as a result.
“It seems like they tried to get rid of the older, more experienced guys making more money than the entry level. I personally see and feel this is aimed at the higher-waged employees,” the employee said. “They replaced me with a $19 an hour worker. I make $26 an hour.” He was told his transfer would be a lateral move and wouldn’t include a pay cut, but he’s still wary that his pay will be reduced from changing departments.
“I loved Tesla at one point. But four and a half years of living what I lived through, I don’t feel the love, what a good, dedicated employee should feel from a company.”
Another employee at the Fremont plant noted that dozens of newly hired workers started training the week after the mass layoff, and that there was also an elimination of overtime. “You get in trouble with one minute of overtime, which is counter-productive because you have people wrapping up earlier than they normally would so they don’t risk going over,’ the worker said.
A Tesla spokesperson said: “We are continuing to hire for essential positions.” The company denied senior and high-waged employees were targeted in the layoff.
Tesla said: “Regarding the number of impacted employees, here’s what we said in our blogpost: as a result of the above, we unfortunately have no choice but to reduce full-time employee headcount by approximately 7% (we grew by 30% last year, which is more than we can support) and retain only the most critical temps and contractors.”
The cuts have been severe. A third employee at the Fremont plant explained his department was cut in half, with the employees who survived this round of layoffs forced to do even more work.
“We’re going to have to take over their positions,” the employee said. “We have to do our job, plus the contractor job. Usually we have to work for two people, now, we’re going to have to work for three people.”
Tesla has suffered quality control setbacks in the past and workers fear those issues may be worsened by the cuts. Ochoa explained he was making several dozen repairs a day on quality control, depending on what line he was on.
He said: “I fear the quality will be greatly diminished. Not all of my repairs were easy to see but would have a lasting effect.”