Tesla lays off hundreds of employees amid Model 3 ‘production hell’

Tesla confirmed Friday afternoon that it separated with hundreds of employees this week.

The separations were a result of the company’s annual review process, a Teslaspokesperson said in a statement to the Silicon Valley Business Journal on Friday afternoon. As part of that process, some workers received promotions and bonuses, she said, and the company is continuing to hire.

Between 300 and 700 employees were affected, many of whom were local, according to The Mercury News. The spokesperson declined to confirm whether those numbers were correct.

The majority of the affected positions were in administrative and sales roles, the company confirmed.

The Palo Alto-based electric car company is currently ramping up manufacturing for its moderately priced Model 3. CEO Elon Musk last week said the company was delaying the unveiling of its all-electric semi truck as Model 3 production hit assembly-line snags.

The spokesperson said the separations were distributed company-wide and not specifically at Tesla’s Silicon Valley locations, which include its Palo Alto headquarters and the Fremont factory where Model 3s are rolling off the line.

“As with any company, especially one of over 33,000 employees, performance reviews also occasionally result in employee departures. Tesla is continuing to grow and hire new employees around the world,” the spokesperson said in a statement.

Tesla is the Bay Area’s largest manufacturer, with about 10,000 employees at the Fremont plant.

Tesla delayed its semi-truck unveiling last week, citing Model 3 production bottlenecks. Musk tweeted that the company was “in production hell,” a phrase he’s used before as Tesla aggressively pushes to gets its lowest priced model yet out the door.

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