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| Global Headcount Reduction | 04/15/2024 | April 15, 2024 Global Headcount Reduction ========================== Sent to Tesla employees on April 15, 2024, announcing a cut of more than 10% of the global workforce. Over the years, we have grown rapidly with multiple factories scaling around the globe. With this rapid growth there has been duplication of roles and job functions in certain areas. As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity. As part of this effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally. There is nothing I hate more, but it must be done. This will enable us to be lean, innovative and hungry for the next growth phase cycle. I would like to thank everyone who is departing Tesla for their hard work over the years. I'm deeply grateful for your many contributions to our mission and we wish you well in your future opportunities. It is very difficult to say goodbye. For those remaining, I would like to thank you in advance for the difficult job that remains ahead. We are developing some of the most revolutionary technologies in auto, energy and artificial intelligence. As we prepare the company for the next phase of growth, your resolve will make a huge difference in getting us there. Thanks, Elon Read the full email as published by Electrek. |
| The Office Is Not Optional | 03/22/2023 | March 22, 2023 The Office Is Not Optional ========================== Sent to Twitter employees at about 2:30 a.m. on March 22, 2023, after Musk noticed the San Francisco office was half empty. The full email was not published; reporters who saw it quoted these lines. The office is not optional. The office in San Francisco was half empty yesterday. Read the report from Business Insider. |
| A Fork in the Road | 11/16/2022 | November 16, 2022 A Fork in the Road ================== Sent at midnight Pacific time on November 16, 2022. It gave remaining Twitter employees until 5 p.m. ET the next day to commit to "the new Twitter" or take three months of severance. From: Elon Musk To: Team [at Twitter] Subj. A Fork in the Road Going forward, to build a breakthrough Twitter 2.0 and succeed in an increasingly competitive world, we will need to be extremely hardcore. This will mean working long hours at high intensity. Only exceptional performance will constitute a passing grade. Twitter will also be much more engineering-driven. Design and product management will still be very important and report to me, but those writing great code will constitute the majority of our team and have the greatest sway. At its heart, Twitter is a software and servers company, so I think this makes sense. If you are sure that you want to be part of the new Twitter, please click yes on the link below: [The link was removed before publication.] Anyone who has not done so by 5pm ET tomorrow (Thursday) will receive three months of severance. Whatever decision you make, thank you for your efforts to make Twitter successful. Read the email as transcribed by CNBC. |
| The Road Ahead Is Arduous | 11/09/2022 | November 9, 2022 The Road Ahead Is Arduous ========================= Musk's first email to the whole company after buying Twitter, sent at 2:39 a.m. ET on November 9, 2022. It ends remote work at the company and lays out the revenue problem he said justified it. Sorry that this is my first email to the whole company, but there is no way to sugarcoat the message. Frankly, the economic picture ahead is dire, especially for a company like ours that is so dependent on advertising in a challenging economic climate. Moreover, 70% of our advertising is brand, rather than specific performance, which makes us doubly vulnerable! That is why the priority over the past ten days has been to develop and launch Twitter Blue Verified subscriptions (huge props to the team!). Without significant subscription revenue, there is a good chance Twitter will not survive the upcoming economic downturn. We need roughly half of our revenue to be subscription. Of course, we will still then be significantly reliant on advertising, so I am spending time with our sales & partnerships teams to ensure that Twitter continues to be appealing to advertisers. This is the Spaces discussion that Robin, Yoel and I hosted today: [A link to a recording of "Elon Q&A: Advertising & the Future" followed here.] The road ahead is arduous and will require intense work to succeed. We are also changing Twitter policy such that remote work is no longer allowed, unless you have a specific exception. Managers will send the exceptions lists to me for review an approval. Starting tomorrow (Thursday), everyone is required to be in the office for a minimum of 40 hours per week. Obviously, if you are physically unable to travel to an office or have a critical personal obligation, then your absence is understandable. I look forward to working with you to take Twitter to a whole new level. The potential is truly incredible! Thanks, Elon Read the full email as published by Business Insider. |
| Headcount Reduction | 06/03/2022 | June 3, 2022 Headcount Reduction =================== Sent to all Tesla employees on June 3, 2022, two days after the return-to-office emails, announcing a 10% cut to salaried headcount. To: Everybody Subject: Headcount Reduction Tesla will be reducing salaried headcount by 10% as we have become overstaffed in many areas. Note this does not apply to anyone actually building cars, battery packs or installing solar. Hourly headcount will increase. Elon Read the email as transcribed by CNBC. |
| To Be Super Clear | 06/01/2022 | June 1, 2022 To Be Super Clear ================= The follow-up email, sent the same day after employees asked for clarification. Musk made clear that in-person attendance was now a condition of employment. Subject: To be super clear Everyone at Tesla is required to spend a minimum of 40 hours in the office per week. Moreover, the office must be where your actual colleagues are located, not some remote pseudo office. If you don't show up, we will assume you have resigned. The more senior you are, the more visible must be your presence. That is why I lived in the factory so much – so that those on the line could see me working alongside them. If I had not done that, Tesla would long ago have gone bankrupt. There are of course companies that don't require this, but when was the last time they shipped a great new product? It's been a while. Tesla has and will create and actually manufacture the most exciting and meaningful products of any company on Earth. This will not happen by phoning it in. Thanks, Elon Read the two emails as published by Electrek. |
| Remote Work Is No Longer Acceptable | 06/01/2022 | June 1, 2022 Remote Work Is No Longer Acceptable =================================== Sent to Tesla staff on May 31, 2022, and reported the next day, ending remote work for everyone who wanted to keep working from home. The subject line is reproduced as published. Subject: Remote work is no longer acceptble Anyone who wishes to do remote work must be in the office for a minimum (and I mean *minimum*) of 40 hours per week or depart Tesla. This is less than we ask of factory workers. If there are particularly exceptional contributors for whom this is impossible, I will review and approve those exceptions directly. Moreover, the "office" must be a main Tesla office, not a remote branch office unrelated to the job duties, for example being responsible for Fremont factory human relations, but having your office be in another state. Thanks, Elon Read the two emails as published by Electrek. |
| The Raptor Production Crisis | 11/26/2021 | November 26, 2021 The Raptor Production Crisis ============================ Sent to SpaceX employees on November 26, 2021, the Friday after Thanksgiving, after Musk learned how far Raptor engine production had fallen behind. The email warned that the company faced a "genuine risk of bankruptcy." Unfortunately, the Raptor production crisis is much worse than it seemed a few weeks ago. As we have dug into the issues following exiting prior senior management, they have unfortunately turned out to be far more severe than was reported. There is no way to sugarcoat this. I was going to take this weekend off, as my first weekend off in a long time, but instead I will be on the Raptor line all night and through the weekend. Unless you have critical family matters or cannot physically return to Hawthorne, we need all hands on deck to recover from what is, quite frankly, a disaster. The consequences for SpaceX if we can't get enough reliable Raptors made is that we then can't fly Starship, which means we then can't fly Starlink Satellite V2 (Falcon has neither the volume *nor* the mass to orbit needed for satellite V2). Satellite V1 by itself is financially weak, whereas V2 is strong. In addition, we are spooling up terminal production to several million units per year, which will consume massive capital, assuming that satellite V2 will be on orbit to handle the bandwidth demand. These terminals will be useless otherwise. What it comes down to is that we face genuine risk of bankruptcy if we cannot achieve a Starship flight rate of at least once every two weeks next year. Thanks, Elon Read the full email as published by The Verge. |
| A Very Difficult Road Ahead | 01/18/2019 | January 18, 2019 A Very Difficult Road Ahead =========================== Sent to all Tesla employees on January 18, 2019, announcing a roughly 7% cut to full-time staff and a hard push toward a $35,000 Model 3. It was also published as a company update on Tesla's website. As we all experienced first-hand, last year was the most challenging in Tesla's history. However, thanks to your efforts, 2018 was also the most successful year in Tesla's history: we delivered almost as many cars as we did in all of 2017 in the last quarter alone and nearly as many cars last year as we did in all the prior years of Tesla's existence combined! Model 3 also became the best-selling premium vehicle of 2018 in the US. This is truly remarkable and something that few thought possible just a short time ago. Looking ahead at our mission of accelerating the advent of sustainable transport and energy, which is important for all life on Earth, we face an extremely difficult challenge: making our cars, batteries and solar products cost-competitive with fossil fuels. While we have made great progress, our products are still too expensive for most people. Tesla has only been producing cars for about a decade and we're up against massive, entrenched competitors. The net effect is that Tesla must work much harder than other manufacturers to survive while building affordable, sustainable products. In Q3 last year, we were able to make a 4% profit. While small by most standards, I would still consider this our first meaningful profit in the 15 years since we created Tesla. However, that was in part the result of preferentially selling higher priced Model 3 variants in North America. In Q4, preliminary, unaudited results indicate that we again made a GAAP profit, but less than Q3. This quarter, as with Q3, shipment of higher priced Model 3 variants (this time to Europe and Asia) will hopefully allow us, with great difficulty, effort and some luck, to target a tiny profit. However, starting around May, we will need to deliver at least the mid-range Model 3 variant in all markets, as we need to reach more customers who can afford our vehicles. Moreover, we need to continue making progress towards lower priced variants of Model 3. Right now, our most affordable offering is the mid-range (264 mile) Model 3 with premium sound and interior at $44k. The need for a lower priced variants of Model 3 becomes even greater on July 1, when the US tax credit again drops in half, making our car $1,875 more expensive, and again at the end of the year when it goes away entirely. Sorry for all these numbers, but I want to make sure that you know all the facts and figures and understand that the road ahead is very difficult. This is not new for us – we have always faced significant challenges – but it is the reality we face. There are many companies that can offer a better work-life balance, because they are larger and more mature or in industries that are not so voraciously competitive. Attempting to build affordable clean energy products at scale necessarily requires extreme effort and relentless creativity, but succeeding in our mission is essential to ensure that the future is good, so we must do everything we can to advance the cause. As a result of the above, we unfortunately have no choice but to reduce full-time employee headcount by approximately 7% (we grew by 30% last year, which is more than we can support) and retain only the most critical temps and contractors. Tesla will need to make these cuts while increasing the Model 3 production rate and making many manufacturing engineering improvements in the coming months. Higher volume and manufacturing design improvements are crucial for Tesla to achieve the economies of scale required to manufacture the standard range (220 mile), standard interior Model 3 at $35k and still be a viable company. There isn't any other way. To those departing, thank you for everything you have done to advance our mission. I am deeply grateful for your contributions to Tesla. We would not be where we are today without you. For those remaining, although there are many challenges ahead, I believe we have the most exciting product roadmap of any consumer product company in the world. Full self-driving, Model Y, Semi, Truck and Roadster on the vehicle side and Powerwall/pack and Solar Roof on the energy side are only the start. I am honored to work alongside you. Thanks for everything, Elon Read the email as published by CNBC. |
| A Difficult, But Necessary Reorganization | 06/12/2018 | June 12, 2018 A Difficult, But Necessary Reorganization ========================================= Sent to all Tesla employees on June 12, 2018, announcing an approximately 9% reduction in staff. Musk posted the email to Twitter himself after it leaked to the press. As described previously, we are conducting a comprehensive organizational restructuring across our whole company. Tesla has grown and evolved rapidly over the past several years, which has resulted in some duplication of roles and some job functions that, while they made sense in the past, are difficult to justify today. As part of this effort, and the need to reduce costs and become profitable, we have made the difficult decision to let go approximately 9% of our colleagues across the company. These cuts were almost entirely made from our salaried population and no production associates were included, so this will not affect our ability to reach Model 3 production targets in the coming months. Given that Tesla has never made an annual profit in the almost 15 years since we have existed, profit is obviously not what motivates us. What drives us is our mission to accelerate the world's transition to sustainable, clean energy, but we will never achieve that mission unless we can eventually demonstrate that we can be sustainably profitable. That is a valid and fair criticism of Tesla's history to date. This week, we are informing those whose roles are impacted by this action. We made these decisions by evaluating the criticality of each position, whether certain jobs could be done more efficiently and productively, and by assessing the specific skills and abilities of each individual in the company. As you know, we are also continuing to flatten our management structure to help us communicate better, eliminate bureaucracy and move faster. In addition to this company-wide restructuring, we've decided not to renew our residential sales agreement with Home Depot in order to focus our efforts on selling solar power in Tesla stores and online. The majority of Tesla employees working at Home Depot will be offered the opportunity to move over to Tesla retail locations. I would like to thank everyone who is departing Tesla for their hard work over the years. I'm deeply grateful for your many contributions to our mission. It is very difficult to say goodbye. In order to minimize the impact, Tesla is providing significant salary and stock vesting (proportionate to length of service) to those we are letting go. To be clear, Tesla will still continue to hire outstanding talent in critical roles as we move forward and there is still a significant need for additional production personnel. I also want to emphasize that we are making this hard decision now so that we never have to do this again. To those who are departing, thank you for everything you've done for Tesla and we wish you well in your future opportunities. To those remaining, I would like to thank you in advance for the difficult job that remains ahead. We are a small company in one of the toughest and most competitive industries on Earth, where just staying alive, let alone growing, is a form of victory (Tesla and Ford remain the only American car companies who haven't gone bankrupt). Yet, despite our tiny size, Tesla has already played a major role in moving the auto industry towards sustainable electric transport and moving the energy industry towards sustainable power generation and storage. We must continue to drive that forward for the good of the world. Thanks, Elon Read the full email as published. |
| Model 3 Production and Productivity Recommendations | 04/17/2018 | April 17, 2018 Model 3 Production and Productivity Recommendations =================================================== Sent to Tesla employees on April 17, 2018, as the company pushed Model 3 production toward 5,000 cars a week. After the production update, Musk appended a short list of productivity rules that became the most-quoted part of the memo. First, congratulations are in order! We have now completed our third full week of producing over 2000 Model 3 vehicles. The first week was 2020, the second was 2070 and we just completed 2250 last week, along with 2000 Model S/X vehicles. This is more than double Tesla's weekly production rate last year and an amazing feat in the face of many challenges! It is extremely rare for an automotive company to grow the production rate by over 100% from one year to the next. Moreover, there has simultaneously been a significant improvement in quality and build accuracy, which is reflected in positive owner feedback. Starting today at Giga and tomorrow at Fremont, we will be stopping for three to five days to do a comprehensive set of upgrades. This should set us up for Model 3 production of 3000 to 4000 per week next month. Another set of upgrades starting in late May should be enough to unlock production capacity of 6000 Model 3 vehicles per week by the end of June. Please note that all areas of Tesla and our suppliers will be required to demonstrate a Model 3 capacity of ~6000/week by building 850 sets of car parts in 24 hours no later than June 30th. Any Tesla department or supplier that is unable to do this will need to have a very good explanation why not, along with a plan for fixing the problem and present that to me directly. If anyone needs help achieving this, please let me know as soon as possible. We are going to find a way or make a way to get there. The reason that the burst-build target rate is 6000 and not 5000 per week in June is that we cannot have a number with no margin for error across thousands of internally and externally produced parts and processes, amplified by a complex global logistics chain. Actual production will move as fast as the least lucky and least well-executed part of the entire Tesla production/supply chain system. By having a Model 3 subsystem burst-build requirement of 6k by the end of June, we will lay the groundwork for achieving a steady 6k/week across the whole Model 3 system a few months later. As part of the drive towards 6k, all Model 3 production at Fremont will move to 24/7operations. This means that we will be adding another shift to general assembly, body and paint. Please refer anyone you know who you think meets the Tesla bar for talent, drive and trust. Between Fremont and Giga, Tesla will be adding about 400 people per week for several weeks. Most of the design tolerances of the Model 3 are already better than any other car in the world. Soon, they will all be better. This is not enough. We will keep going until the Model 3 build precision is a factor of ten better than any other car in the world. I am not kidding. Our car needs to be designed and built with such accuracy and precision that, if an owner measures dimensions, panel gaps and flushness, and their measurements don't match the Model 3 specs, it just means that their measuring tape is wrong. Some parts suppliers will be unwilling or unable to achieve this level of precision. I understand that this will be considered an unreasonable request by some. That's ok, there are lots of other car companies with much lower standards. They just can't work with Tesla. A fair criticism leveled at Tesla by outside critics is that you're not a real company unless you generate a profit, meaning simply that revenue exceeds costs. It didn't make sense to do that until reaching economies of scale, but now we are there. Going forward, we will be far more rigorous about expenditures. I have asked the Tesla finance team to comb through every expense worldwide, no matter how small, and cut everything that doesn't have a strong value justification. All capital or other expenditures above a million dollars, or where a set of related expenses may accumulate to a million dollars over the next 12 months, should be considered on hold until explicitly approved by me. If you are the manager responsible, please make sure you have a detailed, first principles understanding of the supplier quote, including every line item of parts & labor, before we meet. I have been disappointed to discover how many contractor companies are interwoven throughout Tesla. Often, it is like a Russian nesting doll of contractor, subcontractor, sub-subcontractor, etc. before you finally find someone doing actual work. This means a lot of middle-managers adding cost but not doing anything obviously useful. Also, many contracts are essentially open time & materials, not fixed price and duration, which creates an incentive to turn molehills into mountains, as they never want to end the money train. There is a very wide range of contractor performance, from excellent to worse than a drunken sloth. All contracting companies should consider the coming week to be a final opportunity to demonstrate excellence. Any that fail to meet the Tesla standard of excellence will have their contracts ended on Monday. Btw, here are a few productivity recommendations: – Excessive meetings are the blight of big companies and almost always get worse over time. Please get of all large meetings, unless you're certain they are providing value to the whole audience, in which case keep them very short. – Also get rid of frequent meetings, unless you are dealing with an extremely urgent matter. Meeting frequency should drop rapidly once the urgent matter is resolved. – Walk out of a meeting or drop off a call as soon as it is obvious you aren't adding value. It is not rude to leave, it is rude to make someone stay and waste their time. – Don't use acronyms or nonsense words for objects, software or processes at Tesla. In general, anything that requires an explanation inhibits communication. We don't want people to have to memorize a glossary just to function at Tesla. – Communication should travel via the shortest path necessary to get the job done, not through the "chain of command". Any manager who attempts to enforce chain of command communication will soon find themselves working elsewhere. – A major source of issues is poor communication between depts. The way to solve this is allow free flow of information between all levels. If, in order to get something done between depts, an individual contributor has to talk to their manager, who talks to a director, who talks to a VP, who talks to another VP, who talks to a director, who talks to a manager, who talks to someone doing the actual work, then super dumb things will happen. It must be ok for people to talk directly and just make the right thing happen. – In general, always pick common sense as your guide. If following a "company rule" is obviously ridiculous in a particular situation, such that it would make for a great Dilbert cartoon, then the rule should change. If there is something you think should be done to make Tesla execute better or allow you to look forward to coming to work more (same thing in the long term), please send a note to [redacted]@tesla.com. Read the full email. |
| Acronyms Seriously Suck | 05/01/2010 | May 1, 2010 Acronyms Seriously Suck ======================= Musk sent this memo to the entire SpaceX company in May 2010. It has circulated for years as a case study in how invented jargon gets in the way of communication. There is a creeping tendency to use made up acronyms at SpaceX. Excessive use of made up acronyms is a significant impediment to communication and keeping communication good as we grow is incredibly important. Individually, a few acronyms here and there may not seem so bad, but if a thousand people are making these up, over time the result will be a huge glossary that we have to issue to new employees. No one can actually remember all these acronyms and people don't want to seem dumb in a meeting, so they just sit there in ignorance. This is particularly tough on new employees. That needs to stop immediately or I will take drastic action - I have given enough warning over the years. Unless an acronym is approved by me, it should not enter the SpaceX glossary. If there is an existing acronym that cannot reasonably be justified, it should be eliminated, as I have requested in the past. For example, there should be not "HTS" [horizontal test stand] or "VTS" [vertical test stand] designations for test stands. Those are particularly dumb, as they contain unnecessary words. A "stand" at our test site is obviously a *test* stand. VTS-3 is four syllables compared with "Tripod", which is two, so the bloody acronym version actually takes longer to say than the name! The key test for an acronym is to ask whether it helps or hurts communication. An acronym that most engineers outside of SpaceX already know, such as GUI, is fine to use. It is also ok to make up a few acronyms/contractions every now and again, assuming I have approved them, e.g. MVac and M9 instead of Merlin 1C-Vacuum or Merlin 1C-Sea Level, but those need to be kept to a minimum. Read the full text as transcribed online. |