16 Apr 2024, 13:12
Julian Wettengel

Fears of job cuts at Berlin's Tesla factory after carmaker announces global workforce reduction

n-tv / Handelsblatt / Elektrek / The Guardian

Plans announced by electric vehicle manufacturer Tesla to cut ten percent of its global workforce have led to worries over the potential impact on workers at Tesla’s gigafactory near Berlin, reported news station n-tv. While business daily Handelsblatt initially reported that Tesla could axe around 3,000 jobs at the gigafactory – a number based on "internal sources" – a Tesla spokesperson said that the number equalling about a quarter of the local Tesla workforce "lacks any basis" in reality. "We are examining [the measure to let workers go] and will implement it in the Gigafactory Berlin-Brandenburg, taking into account all labour laws and co-determination requirements with the involvement of the works council," said the spokesperson, according to n-tv.

Tesla’s decision to cut its workforce is a reaction to slowing demand for their electric vehicles and pressure on prices, reported newspaper The Guardian. Tesla's CEO, Elon Musk, announced the decision to lay off ten percent of the company’s global workforce in a memo first reported on by the online publication Elektrek. "This will enable us to be lean, innovative and hungry for the next growth phase cycle," said Musk.

The gigafactory near Berlin, which opened only in 2022, has been hailed by local lawmakers and business representatives as a flagship project that demonstrates the ability to quickly develop major new industry projects in Germany. The company currently employs about 12,500 people at its German factory. However, despite being a major employer that promised to provide long-term jobs in the region, Tesla has grappled with local resistance against its investments from the early stages of the factory. In a non-binding referendum earlier this year, residents of the Grünheide municipality in the state of Brandenburg rejected an expansion of the factory due to the expected environmental impact.

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