Tesla’s (NASDAQ:TSLA) shares declined in trading after the EV major announced that it would lay off more than 10% of its workforce globally. The company’s Founder and CEO, Elon Musk, unveiled the move in an email to employees.
According to the email accessed by The Wall Street Journal, Musk stated that TSLA was undertaking this move to reduce costs and increase its productivity. At the end of 2023, Tesla had around 140,000 employees globally.
Tesla Is Struggling with Slowing EV Sales
Tesla is struggling globally with slowing EV sales. In the first quarter, the firm produced 433,000 vehicles and delivered around 387,000. This was below analysts’ expectations of 457,000 vehicle deliveries.
Even in China, which is one of the world’s biggest EV markets, the company is facing stiff competition from domestic players like BYD (BYDDY). The tepid sales of its EVs have led TSLA to curtail its production in Shanghai.
In fact, last month, the company asked employees in its Shanghai facility to work five days a week instead of the usual six-and-a-half days.
Is Tesla a Buy or Sell?
Analysts remain sidelined about TSLA stock, with a Hold consensus rating based on nine Buys, 19 Holds, and seven Sells. Year-to-date, TSLA has declined by more than 30%, and the average TSLA price target of $196.72 implies an upside potential of 19.5% at current levels.
Is It Wise to Allocate $1,000 Toward TSLA Stock Right Now?
Before you hurry to invest in TSLA, think about the following:
TipRanks’ team has built the Top Stocks Portfolio for investors, and Tesla is not included. Our portfolio highlights companies that have been hand-picked for their potential to deliver significant gains in the years ahead.
