Elon Musk Confirms Tesla Cutting Salaried Workforce By 10% Over Next 3 Months

Tesla Inc (NASDAQ: TSLA) CEO Elon Musk said on Tuesday that the electric vehicle maker is reducing the salaried workforce by 10% over the next three months, for the first time confirming a timeline for the reduction, adding that he expects the company's hourly workforce to grow instead.

What Happened: The billionaire entrepreneur said that Tesla's overall immediate headcount will be lower by 3% to 3.5% in the near term but it will be higher in about a year's time.

"A year from now, I think our headcount will be higher both in salaried and hourly” workers, but for now the headcount reduction will be “3% to 3.5%," Musk, participating virtually, told Bloomberg at the Qatar Economic Forum being held in Doha.

The world's richest person explained that Tesla grew very fast on the "salaried side" and a little too fast in some areas. "We expect to grow our hourly workforce."

Why It Matters: Earlier this month, Musk had said that he wanted to cut 10% of jobs at Tesla, although he later clarified that "total headcount will increase, but salaried should be fairly flat."

The 50-year-old CEO had reportedly told employees that Tesla is to "pause all hiring worldwide" and suggested he had a "super bad feeling" about the economy.

Price Action: Tesla closed 1.7% higher at $650.3 on Friday, according to data from Benzinga Pro.