Tesla Cuts Employee Pay 30% Amid Coronavirus Pandemic

Electric car maker Tesla Inc.(NASDAQ:TSLA) is cutting employee salaries by as much as 30% to save costs while the coronavirus pandemic forces the company to shut down production.

Tesla vice presidents and above will see the steepest salary reductions, followed by a 20% cut for directors, and 10% for all other employees, according to the company. Workers outside the U.S. will see similar reductions. Tesla employees who can’t work from home will be furloughed without pay, though they’ll keep health-care benefits.

The move adds to the growing number of companies slashing labur costs to weather the pandemic. The outbreak hit just as Tesla was ramping up the production of its Model Y crossover, accelerating output at its new Shanghai plant and forging ahead with plans to build a brand-new production facility near Berlin.

Tesla agreed to idle U.S. production last month amid orders to do so from authorities. The electric-vehicle maker expects to resume normal production at its U.S. facilities on May 4. Even after re-opening its facilities, Tesla will probably need about two weeks to ramp up production again.

The company has about 56,000 employees. Its sole U.S. car production facility is in Fremont, California, where current stay-at-home orders extend until May 3. The pay cuts are expected to last until the end of the second quarter and those furloughed are likely to be asked to return on May 4.

Tesla’s Shanghai plant recovered from a virus-related shutdown faster than many in the industry, helped by aid from local authorities. After resuming operations in February, the factory — Tesla’s only outside the U.S. — surpassed the capacity it had before the shutdown, reaching a weekly production of 3,000 cars, the company said.

Related posts

Carl Icahn Increases His Stake In Take-Two Interactive To 10.68%


iPad Mini Display Outperformed By Kindle Fire HD & Nexus 7


Foxconn Might Open Manufacturing Plants In The U.S. [REPORT]


Peter Cundill Protégé Tim McElvaine on Investing in Japan [VIDEO]


Set Bing Home Page Image As Lock Screen In Windows 8


Morning Market News: JCP, APO, MCHP, ZIP, ENR, LGF, EA, ATVI, COV, LNT