Vehicles parked outside the Tesla Inc. solar panel factory in Buffalo, New York, U.S., Wednesday, Dec. 26, 2018.
Andrew Harrer | Bloomberg | Getty Images
Tesla is laying off 285 employees in New York state as part of a broader restructuring according to a WARN notice filed in the state. Most of these employees reportedly worked at the company’s Buffalo facility and a handful worked at an area store and service center.
Earlier this week, Tesla CEO Elon Musk sent out a company-wide memo saying the automaker would cut more than 10% of its global workforce. Few details were shared by Tesla about the layoffs beyond that leaked memo stating that reducing the workforce would help “prepare the company” for a “next phase of growth.”
The disclosed layoffs in Buffalo result in a 14% reduction in headcount there.
Tesla took over the Buffalo factory after completing its $2.6 billion acquisition of solar installer SolarCity in 2017.
Tesla’s acquisition of SolarCity has been widely criticized as a bailout for a struggling solar company with deep ties to Tesla’s CEO and board of directors. Musk financed and co-founded SolarCity with his cousins, Lyndon and Peter Rive, and served as its president. Another of Musk’s companies, SpaceX, had purchased SolarCity bonds and if the company went bankrupt, they would also lose their investment.
Empire State taxpayers doled out about $1 billion to build the Buffalo factory, including equipment purchases, hoping to support the creation of thousands of high-tech jobs in the region. Although Tesla said it would make solar panels at its Buffalo plant, its efforts to grow its solar business have faltered over the years.
In 2023, Tesla’s solar deployments fell to a total of 223 megawatts, down 36% from 348 megawatts the previous year. This represented the lowest level of solar deployments for Tesla since 2020, when they reported 205 megawatts.
Tesla’s energy division still generates most of its revenue through the sale of battery backups, also known as battery energy storage systems, which are used in residential, business and utility-scale projects.
Instead of making solar panels as its main business in Buffalo, Tesla assembles Supercharger equipment there and previously moved part of its Autopilot data labeling team there. The company also told shareholders it will build supercomputer hardware in Buffalo.
Earlier this month, Reuters reported that Tesla would focus efforts on robotaxi technology and abandon plans to produce a more affordable electric vehicle.
On Tuesday afternoon, Musk wrote in a send on his social network X who “isn’t really betting on the company, but is going to the wall for autonomy”.
Tesla has not yet said whether the company will stick to its “master plan” for 2023, which included “a proposed path to achieving a sustainable global energy economy through end-use electrification and sustainable electricity generation and storage ”.
Tesla plans to discuss first-quarter results with shareholders on April 23, and then executives are expected to reveal more about the restructuring and future strategy.