Tesla dismisses hundreds after performance reviews

PALO ALTO, Calif. — Tesla confirmed Saturday that it fired hundreds of workers this past week, including engineers, managers and factory workers, even as the company struggles to expand its manufacturing and product line.

The dismissals come at a crucial point for the company, which is pushing to increase vehicle production fivefold and reach a broader market with its new Model 3 sedan.

The electric vehicle maker missed targets for producing the lower-cost sedan, manufacturing only 260 last quarter despite a wait list of more than 450,000 customers.

The company said the dismissals were the result of a companywide annual review. Some workers received promotions and bonuses, and the company expects to hire for the “vast majority” of new vacancies, a spokesman said.

“As with any company, especially one of over 33,000 employees, performance reviews also occasionally result in employee departures,” a spokesman said.

In multiple interviews, former and current employees said little or no warning preceded the dismissals. The workers interviewed include engineers working on vehicle design and production, a supervisor and factory employees.

Workers estimated that 400 to 700 employees were fired. Tesla refused to say how many employees were let go.

The spokesman said most of the dismissals were administrative and sales workers.

Workers spoke on the condition of anonymity because they feared reprisals from the company.

Employees said the firings have lowered morale through many departments. Several said Model X, Model S and former SolarCity operations seemed to be targeted.

Tesla has faced ongoing discontent from some factory workers, who have complained about work conditions and wages below the auto industry average.

Tesla has a hearing before the National Labor Relations Board in November for charges that company supervisors and security guards harassed workers distributing union literature. Tesla denied the accusations.

Openly pro-union workers were among those fired this week. Some believe they were targeted.

The company denied union activities played a role in the dismissals.