Did Elon Musk just go back on his word? Image Credit: AP

California: Tesla laid off hundreds of workers on its autopilot team as the electric-vehicle maker shuttered a California facility. Surprisingly, the majority of those who were let go were hourly workers. As recently as last week, CEO Elon Musk had outlined plans to cut 10 per cent of salaried staff but said he’d be increasing hourly jobs.

Teams at the San Mateo office were tasked with evaluating customer vehicle data related to the autopilot driver-assistance features and performing so-called data labeling. Many of the staff were data annotation specialists, all of which are hourly positions. About 200 workers were let go in total. Prior to the cuts, the office had about 350 employees, some of whom were already transferred to a nearby facility in recent weeks.

Tesla is trimming its ranks after a surge in hiring in recent years. The company had grown to about 100,000 employees globally as it built new factories in Austin and Berlin.

‘A bad feeling…’

Musk caught workers by surprise earlier this month when he said layoffs would be necessary in an increasingly shaky economic environment. He clarified in an interview with Bloomberg that about 10 per cent of salaried employees would lose their jobs over the next three months, though the overall headcount could be higher in a year. The EV market leader’s downsizing efforts have focused on areas that grew too quickly. Some human resources workers and software engineers are among those who have been laid off, and in some cases, the cuts have hit employees who had worked at the company for just a few weeks.

Those affected by the latest move worked on one of the higher-profile features in Tesla vehicles. In job postings, Tesla has said that labeled data is the “critical ingredient for training powerful Deep Neural Networks, which help drive the Tesla vehicles autonomously.” Staffers in Buffalo, New York, and San Mateo spent hours labeling images for cars and the environment they navigate, such as street signs and traffic lanes.

In Buffalo, Tesla has continued to expand its Autopilot data-labeling teams, a person familiar with the matter said. But staff at that location, who are doing the same role, are paid a lower hourly rate than in San Mateo, the person said.

Tesla’s shares fell less than 1 per cent in late trading. The stock tumbled 34 per cent this year through Tuesday’s close, compared with a 20 per cent decline in the SP 500 Index.