Elon Musk orders hiring freeze, warns of job cuts at Tesla in latest leaked email

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Tesla CEO Elon Musk has directed executives to pause all hiring and prepare for job cuts, according to a leaked email that was first viewed by Reuters.

Tesla shares fell 8.5% following the Reuters report.

An additional email sent Friday to all employees, clarified his comments to executives, stating that the headcount reduction would be for salaried workers. He added that the job cuts would not apply to people building cars, battery packs or solar. Musk also said headcount would increase in those areas.

President Biden, who was asked Friday in a press briefing about Musk's economic warning, pointed to recent investment and job hiring announcements by Ford, Stellantis and Intel.

"While Elon Musk is talking about that, Ford is increasing its investment overwhelming," said Biden, who added the automaker was hiring more than 6,000 union workers at its U.S. factories. "So, lots of luck on his trip to the moon, I don't know."

Musk replied via Twitter with the message "Thanks Mr. President!" and a link to a press release from NASA announcing the space agency had picked SpaceX, another Musk company, to send astronauts to the moon.

Elon Musk tweet response to Biden
Elon Musk tweet response to Biden

Image credit: Screenshot of tweet on Twitter

Musk's hiring freeze directives came the same week that Musk sent employees two emails, which were also leaked, that the company was ending its remote work option. Musk told staff that if they didn't want to return to the office they should leave.

In the first email, which was later corroborated by Musk in a response via Twitter, he told employees that they must work a minimum of 40 hours in a Tesla office. A followup email entitled "to be super clear" explained that "the more senior you are, the more visible must be your presence."

Elon Musk internal email
Elon Musk internal email

Image Credits: Screenshot/Tesla

Musk's latest email strikes a gloomier tone about the economy, noting he has a "super bad feeling" and hints at a coming recession. Musk tells the executives who received the email that a 10% cut of its workforce will be required.

Tesla and its subsidiaries employs 99,290 people, according to its annual filing. Those employees are spread throughout its factories and facilities, including its headquarters in Austin as well as in Buffalo, New York, Sparks, Nevada, Fremont, California, Berlin and Shanghai. Tesla also has a smattering of offices in California and Germany and retail stores in Europe, Australia and North America.